HomeMy WebLinkAboutRes2017-056CITY OF SEWARD, ALASKA Sponsored by: Hunt
RESOLUTION 2017-056
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD,
ALASKA, AUTHORIZING A 10-YEAR LEASE WITH TWO 10-YEAR
OPTIONS TO EXTEND, WITH THE U.S. DEPARTMENT OF ARMY FOR
LOT 9A, FORT RAYMOND SUBDIVISION REPLAT NO. 1(US ARMY REC
CAMP), AND AUTHORIZING A PUBLIC UTILITY EASEMENT
WHEREAS, the City of Seward and the US Army Engineer District, Alaska entered into US
Government Lease No. DACA85-5-86-20 on December 17, 1985, which lease has been amended 5
times, most recently in Resolution 2016-083 passed on December 12, 2016; and
WHEREAS, this lease covers the property known as the US Army Recreation Camp in
Seward, Alaska, and the lease expired on June 30, 2017, with the parties agreeing to continue
operations under that lease until such time as a new ten-year lease could be finalized; and
WHEREAS, the parties have agreed to a new ten-year lease with two ten-year options to
extend with substantive changes from the original lease entered into in 1985; and
WHEREAS, modifications from the prior lease include incorporating new standard lease
language for City leases, increasing the fair market rental rate over ten years from 2% per year
(currently $22,000) to 8% per year ($58,000) to be consistent with other leases of City land,
requiring that improvements be maintained in as good or better condition than at the start of this
lease, requiring acceptance of a new public utility easement requested by the City, and incorporating
rental rate increases on the basis of five-year property appraisals beginning at the end of the first ten-
year term.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SEWARD, ALASKA, that:
Section 1. The City Council hereby finds that it is in the public interest to authorize the
attached lease of Lot 9A, Fort Raymond Subdivision Replat No. 1 between the City of Seward and
the US Army Engineer District, Alaska, expiring June 30, 2027, in substantial form as attached
hereto.
Section 2. The lease provides for payment, in arrears, in the amount of $22,000 for the
period July 1, 2017 through June 30, 2018, and increasing annually thereafter until reaching $58,000
for the period January 1, 2026 through June 30, 2027.
Section 3. The Public Utility Easement as contained in Exhibit "B" hereto, is hereby
approved by the Seward City Council, and the City Manager is authorized to take actions necessary
to
CITY OF SEWARD, ALASKA
RESOLUTION 2017-056
record said easement which is described as the east 30 feet and the east 36 feet of the north 46 feet,
and the northeast triangle west ofthe afore described easement, being 18 feet in height and 38 feet in
width of Lot 9A, Fort Raymond Subdivision, Replat No. 1, Section 34, Township 1 North, Range 1
West of the Seward Meridian.
Section 4. This resolution shall take effect 30 days after adoption in accordance with Section
7.05.145 of the Seward City Code and thereafter the lease effective date shall be July 1, 2017.
PASSED AND APPROVED by the City Council of the city of Seward, Alaska, this 23`d day
of October, 2017.
THE CITY OF SEWARD ALASKA
LL��7' " k- yC9,3
David Squires, May
AYES:
Casagranda, Keil, McClure, Slater, Towsley, Horn, Squires
NOES:
None
ABSENT:
None
ABSTAIN:
None
ATTEST:
Brenda Bailou MMC
City ClerkIe
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Council Agenda Statement
Meeting Date: October 23, 2017
To: Seward City Council
Through: Jim Hunt, City Manager
From: Kristin Erchinger, Finance Director.
Agenda Item: New 10-Year Lease with US Army Rec Camp Lease, and approval of a public utility
easement
BACKGROUND & JUSTIFICATION:
The Seward City Council approved the original lease of the US Army Rec Camp to the US Army Engineer District,
Alaska, on December 17, 1985 for a ten-year term with options to renew for subsequent 10-year terms thereafter,
to September 30, 2016. Subsequent amendments extended that lease until June 30, 2017, at which time the lease
expired. The City and the Department of the Army agreed to continue under the same lease terms until negotiations
for a new long-term lease were complete.
The initial lease was for 12.43 acres more or less, at a lease rate of $10,000 per year for the first ten years, and 25
percent of the fair market rental value of the leased land for subsequent years (equal to 2% of the fair market value
of the property). The original lease was amended as follows: 1) Supplemental Agreement No. I dated August 1,
1987 reduced the size of the leased parcel to 11.824 acres more or less; 2) Supplemental Agreement No. 2 dated
April 11, 1997 eliminated the determination of fair market rental value of 25 percent of fair market rental value,
and assessed annual rent in the amount of $10,300 for the period October 1, 1996 through September 30, 2006; and
3) Supplemental Agreement No. 3 dated September 8, 2006 exercised the option to extend the lease through
September 30, 2016, at an annual rental amount of $18,000; 4) Supplemental Agreement No. 4 dated September
16, 2016 authorized a short-term lease extension through December 31, 2016; and Supplemental Agreement No. 5
dated December 12, 2016, extended the term to June 30, 2017.
The parties have agreed to a new ten-year lease with two ten-year options to extend. The lease rate in the first year
is increasing to $22,000, and by $4,000 per year thereafter during the initial ten-year lease term, until it reaches
$58,000 per year. Thereafter, the lease rate will be set at 8% of the fair market value of the land as determined by
property appraisals every five years, in the same manner as other City leases. The lease requires the lessee to
maintain the property in as good or better condition than at the start of this term, and the parties have documented
the condition of each building and each amenity on the property with photographs. The lease can be extended for
two additional ten-year periods, only upon approval of the Seward City Council. The City has shifted responsibility
for environmental and general liability to the lessee. The parties have agreed to execute a public utility easement
for the electronical infrastructure and utilities affecting the property.
INTENT:
To enter into a new 10-year lease with the US Department of the Army, for the US Army Rec Camp located at Lot
9A, Fort Raymond Subdivision Replat No. 1, Seward, Alaska.
CONSISTENCY CHECKLIST:
Yes
No
NIA
1
Comprehensive Plan: p. 6 "Economic Development - Strengthen and diversify
the economy of Seward by working with the private sector and other
X
governmental units. "; p. 19 "Encourage additional military facilities that
upgrade Seward as a Morale Welfare and Recreation (MWR) destination. "
2.
Strategic Plan:
X
3.
Other:
X
FISCAL NOTE: The current lease generates annual revenues of $18,000. In year one of the new lease, the lease
revenue is set at $22,000 and will increase by $4,000 per year until such time as it reaches $58,000 per year.
Thereafter, the lease rate will be set at 8% of fair market value as determined by property appraisals every five
years.
Approved by Finance Department:����t�i�
ATTORNEY REVIEW: Yes X No
RECOMMENDATION:
Approve City Council Resolution 2017- 056 authorizing a ten-year lease with two ten-year options to extend, with
the United States Department of the Army, for lease of Lot 9A, Fort Raymond Subdivision Replat No. 1, and
approving a public utility easement.
LEASE AGREEMENT
between
CITY OF SEWARD, ALASKA
and
UNITED STATES OF AMERICA
acting by and through the
SECRETARY OF THE ARMY
Effective Date: July 1, 2017
TABLE OF CONTENTS
ARTICLE 1 - LEASED LAND....................................................................................................
2
1.1 Description ofLeased Land....................................................................................
2
1.2 Covenant of Quiet Enjoyment.................................................................................
2
1.4 Property Accepted"As-is.\......................................................................................
2
1.5 Permits....................................................................................................................
2
1.6 Platting....................................................................................................................3
ARTICLE 2 - LEASE TERM......................................................................................................
3
ARTICLE 3 - RENTAL RATE...................................................................................................
3
3.1 Initial Rental Rate...................................................................................................
3
3.2 Rental Adjustments..................................................................................................
4
3.3 Procedure for Rental Adjustment............................................................................
4
3.4 Effect of Late Appraisal by CITY............................................................................
5
3.5 Appraisal by LESSEE.............................................................................................
5
3.6 Effective Date of Adjusted Rental Rate...................................................................
6
3.8 Late Payment Charge.............................................................................................
6
ARTICLE 4 - USE OF LEASED LAND....................................................................................
6
4.1 Use ofLeased Land.................................................................................................
6
4.2 Obligations of LESSEE...........................................................................................
6
4.5 Tams and Other Service Fees...............................................................................
7
4.6 Time for Payment of Utilities..................................................................................
7
ARTICLE 5 - UTILITIES AND RIGHTS OF ACCESS..........................................................
7
5.1 Utilities....................................................................................................................7
5.2 Third -Party Improvements......................................................................................
8
5.3 Easements...............................................................................................................
8
ARTICLE 6 - CONSTRUCTION BY LESSEE.........................................................................
9
6.1 Improvements on Leased Land...............................................................................
9
6.2 City Review of Construction.................................................................................
10
ARTICLE 7 - RETURN OF LEASED LAND/SITE...............................................................
10
7.1 Return ofLeased Land in Original Condition......................................................
10
7.2 Return ofLeased Land in Different Condition.....................................................
10
ARTICLE 8 - FORCE MAJEURE...........................................................................................
11
ARTICLE 9 - LESSEE'S ACTS OF DEFAULT.....................................................................
11
ARTICLE 10 - REMEDIES FOR DEFAULT BY LESSEE ..................................................
12
ARTICLE 11 - TITLE TO IMPROVEMENTS INSTALLED BY LESSEE ........................
14
11.1 Real Property Improvements................................................................................
14
11.2 Personal Property.................................................................................................
14
ARTICLE 12 - ASSIGNMENT OR SUBLEASE....................................................................
14
12.1 Assignment ofLease or Subleasing.......................................................................
14
Page i of 29
ARTICLE 13 - LESSEE'S DUTY TO DEFEND.....................................................................
14
ARTICLE 14 - CITY'S DUTY TO DEFEND/INDEMNIFY.................................................
15
ARTICLE 15 - INSURANCE....................................................................................................
15
ARTICLE 16 - CONDEMNATION..........................................................................................
15
ARTICLE 17 - ARBITRATION...............................................................................................
15
17.1 Arbitration.............................................................................................................15
ARTICLE 18 - MAINTENANCE AND REPAIRS.................................................................
17
18.1 Normal Maintenance............................................................................................
17
18.2 Safety Issues..........................................................................................................
17
18.3 Cost of Repairs......................................................................................................
17
ARTICLE 19 - ENVIRONMENTAL CONCERNS................................................................
18
19.1 Hazardous Materials............................................................................................
18
19.2 Permits and Reporting..........................................................................................
19
ARTICLE 20 - ESTOPPEL CERTIFICATES........................................................................
19
ARTICLE 21 - CONDITIONS AND COVENANTS..............................................................
20
ARTICLE 22 - NO WAIVER OF BREACH...........................................................................
20
ARTICLE 23 - TIME OF THE ESSENCE..............................................................................
20
ARTICLE 24 - COMPUTATION OF TIME...........................................................................
20
ARTICLE 25 - SUCCESSORS IN INTEREST.......................................................................
20
ARTICLE 26 - ENTIRE AGREEMENT.................................................................................
21
ARTICLE 27 - GOVERNING LAW........................................................................................
21
ARTICLE 28 - PARTIAL INVALIDITY.................................................................................
21
ARTICLE 29 - RELATIONSHIP OF PARTIES....................................................................
21
ARTICLE 30 — INTERPRETATION.......................................................................................
22
ARTICLE 31 - CAPTIONS.......................................................................................................
22
ARTICLE 32 - AMENDMENT.................................................................................................
22
ARTICLE 33 - NOTICES..........................................................................................................
22
ARTICLE 34 - FIRE PROTECTION.......................................................................................
23
Page ii of 29
EXHIBIT A: PLAT NO. 87-12 MAP
EXHIBIT B: PUBLIC UTILITY EASEMENT
EXHIBIT C: PUBLIC UTILITY EASEMENT MAP
EXHIBIT D: SEWER TARIFF, GROUP E CHARGES
Page iii of 29
LEASE AGREEMENT
DACA85-5-17-00094
THIS LEASE AGREEMENT (the "LEASE") is made by and between the CITY OF
SEWARD (the "CITY") Tax Identification: 92-6000086, a municipal corporation located in the
Kenai Peninsula Borough, State of Alaska, whose mailing address is P.O. Box 167, Seward,
Alaska 99664 and THE UNITED STATES OF AMERICA under Title 10 USC 2663, acting
by and through the Secretary of the Army (the "LESSEE"), whose mailing address is
Department of the Army, U.S. Army Engineer District, Alaska, P.O. Box 6898, JBER, Alaska
99506-0898.
WHEREAS, LESSEE and CITY are parties to an existing lease (City Lease No. 10-034
and Department of the Army Lease No. DACA85-5-86-20) which was entered into on the 17'h day
of December in the year one thousand nine hundred and eighty-five (1985), and which lease has
been extended and remains in place until June 30, 2017; and
WHEREAS, LESSEE and CITY desire to enter into a new lease for the purpose of the
LESSEE continuing to lease land from the CITY for the U.S. Army Recreation Camp in Seward,
and for other government purposes; and
WHEREAS, the City Council of CITY has determined that lease of the Leased Land to
LESSEE for the purposes described herein would be in the public interest; and
WHEREAS, it is the intent of this LEASE to transfer from CITY to LESSEE the entire
burden of compliance with environmental regulations or controls with respect to LESSEE's
operations on the Leased Land during the lease term; and
WHEREAS, LESSEE concurs with the City that reserves the utility easement as described
in Exhibit "B" and "C" attached hereto.
NOW THEREFORE, for and in consideration of the mutual promises and covenants
hereinafter contained, the parties hereto agree as follows:
Page 1 of 29
ARTICLE 1 - LEASED LAND
1.1 Description of Leased Land. The Leased Land is located in the City of Seward, Alaska.
The Leased Land is described as follows:
Lot 9A, Fort Raymond Subdivision, Replat No. 1, Section 34, Township 1 North, Range 1
West of the Seward Meridian, Seward, Alaska, containing 11.824 acres, more or less, as
shown on the attached Plat No. 87-12 map marked Exhibit "A" (the "Leased Land"), which
is incorporated herein by reference.
1.2 Covenant of Quiet Enjoyment. Subject to the encumbrances as of the date hereof, any
reasonable restrictions imposed on the Leased Land as part of recording of a plat by CITY,
and the provisions of this LEASE, CITY hereby covenants and warrants that it is unaware
of any prior conflicting use of the Leased Land that would adversely affect LESSEE's
intended use of the subject parcel.
1.3 Officials Not to Benefit. No member of or Delegate to Congress , or Resident
Commissioner shall be admitted to any share of part of this lease contract, or to any benefit
that may arise therefrom; but this provision shall not be construed to extend to this lease
contract if made with the City for its general benefit.
1.4 Property Accepted "As -is. " LESSEE acknowledges that it has inspected the Leased Land
and accepts the same "as -is" and without reliance on any expressed or implied
representations or warranties of CITY (other than the representations in Section 1.2
hereof), or agents of CITY, as to the actual physical condition or characteristics thereof
and the legal description or depiction of the Leased Land in Section 1.1 or Exhibit A hereto.
1.5 Permits. LESSEE, at its sole cost, shall obtain all permits necessary to the construction
and operation of its facilities on the Leased Land. CITY may from time to time, upon
request of LESSEE, execute such documents, petitions, applications and authorizations as
may be necessary, as the underlying fee owner, to file with an agency or public body
responsible therefor an application for conditional use permits, zoning and re -zoning,
tentative and final tract approval, or precise plan approval that may be required for the
lawful construction and operation of the facilities of LESSEE permitted on the Leased Land
by the terms of this LEASE. However, nothing in this Section shall be construed as
requiring CITY to support or approve any such application or permit requests. If the
agency or public body responsible to approve or grant such application or permit request
is a City of Seward agency, department, or board, LESSEE shall follow all City of Seward
procedures, the same as any other applicant making similar requests of the City of Seward,
according to the Charter, ordinances, resolutions, or any regulation, rules or procedures of
Page 2 of 29
the City of Seward. Nothing in this Section imposes any duty or responsibility on CITY
to assist LESSEE in obtaining any other permits or approvals, including without limitation
those required by the U.S. Army Corps of Engineers (e.g., wetland fill permits), the
Environmental Protection Agency (e.g., Clean Air Act permits), the Alaska Department of
Public Facilities and Transportation (e.g., right-of-way permits), the Alaska Department of
Fish and Game, and the Alaska Department of Environmental Conservation.
1.6 Platting. In the event CITY elects to replat, CITY agrees to include the Leased Land in
such replat in accordance with reasonable requests by LESSEE. If LESSEE requests a
replat of the Leased Land prior to that time, CITY shall assist LESSEE in the preparation
and filing of the replat, and LESSEE shall reimburse CITY for CITY's costs in assisting
with the preparation and filing of the replat. LESSEE agrees to sign the plat and any other
documents necessary to complete the platting or replatting of any area including all or a
portion of the Leased Land. LESSEE shall accept other reasonable restrictions, easements,
or plat notes as may be required by CITY or other governmental authorities as a condition
to filing the plat of the Leased Land or the plat of CITY -owned real property adjacent to
the Leased Land.
ARTICLE 2 - LEASE TERM
2 Lease Term. The term of this LEASE (the "Lease Term") shall be in accordance with
CITY's authorization Resolution No. 2017-056 (the "Resolution"). Upon effectiveness of
the resolution and execution of this Lease by the CITY, the Lease Term shall commence
on July 1, 2017 and that date shall be the effective date of this LEASE (the "Effective
Date"). The Lease Term shall run from July 1, 2017 through June 30, 2027 provided that
unless and until the LESSEE shall give notice of termination, provided by nonappropriated
funds, Director, Family and Morale, Welfare and Recreation (DFMWR), Fort Wainwright,
Fund Citation QG1-LF-53-746-87, for lease payments; provided that this original lease
shall in no event extend beyond June 30, 2027; however, if mutually agreed in advance, in
writing, LESSEE may be granted an option for two additional 10-year extensions, if
approved by the Seward City Council. The LESSEE may terminate this lease in whole or
in part, at any time by giving thirty (30) days' notice in writing to the CITY, and no rental
shall accrue after the effective date of termination.
ARTICLE 3 - RENTAL RATE
3.1 Initial Rental Rate. Commencing on the Effective Date of this LEASE, the annual rental
rate for the Leased Land shall be set in accordance with paragraph 3.2. However, the
parties acknowledge that current CITY lease policy requires that rental rates be established
consistent with fair market rental value for the Leased Land (equivalent to 8% of fair
Page 3 of 29
market value). The CITY agrees to incremental adjustments to the annual rental rate until
such time as the annual rental rate equals 100% of the fair market rental value. Rent shall
be payable annually in arrears, on July 1, at 100% of the initial rental rate, and then as later
adjusted under this Article 3.
3.2 Rental Adjustments. The annual rental payment shall be adjusted on July 1, 2017 and on
the same date every year thereafter through July 1, 2027, to increase by an additional
$4,000 annually, until such time as the annual rental rate equals 100% of fair market rental
value (where fair market rental value is defined as the equivalent of 8% of fair market
value). Annual rental values beginning July 1, 2017 through June 30, 2027 are as follows:
July 1, 2017
— June 30, 2018 =
$22,000
July 1, 2018
— June 30, 2019 =
$26,000
July 1, 2019
— June 30, 2020 =
$30,000
July 1, 2020
— June 30, 2021 =
$34,000
July 1, 2021
— June 30, 2022 =
$38,000
July 1, 2022
— June 30, 2023 =
$42,000
July 1, 2023
— June 30, 2024 =
$46,000
July 1, 2024
— June 30, 2025 =
$50,000
July 1, 2025
— June 30, 2026 =
$54,000
July 1, 2026
— June 30, 2027 =
$58,000
The rental payment shall be adjusted on July 1, 2027 and on the same date every five years
thereafter. An amendment to the Lease will be made for the adjusted annual rental payment
to be paid under the remaining terms of this Lease shall be the appraised fair market rental
value (the "Fair Market Rental Value") of the Leased Land at the highest and best use of
the Leased Land. The highest and best use of the Leased Land shall be determined without
regard to LESSEE's intended or actual use of the Leased Land unless that use is
coincidentally the highest and best use of the Leased Land. CITY shall complete such
appraisal and deliver a copy of the appraisal report to LESSEE not less than one hundred
twenty (120) days before each Rental Adjustment Date.
3.3 Procedure for Rental Adjustment. To adjust the rent as of any successive Rental
Adjustment Date, CITY shall, at its own expense, retain an independent State of Alaska
certified MAI appraiser (Member, Appraisal Institute), who shall determine the "Fair
Market Rental Value" of the Leased Land in accordance with this Article 3, exclusive of
improvements placed thereon by LESSEE but inclusive of all improvements made by
CITY (including those made before or subsequent to this LEASE). The appraiser's report
shall be delivered to LESSEE not less than ninety (120) days before the Rental Adjustment
Date. The appraiser's determination of Fair Market Rental Value of the Leased Land shall
Page 4 of 29
constitute a final binding determination of the Fair Market Rental Value and the adjusted
rental rate until the next Rental Adjustment Date, unless LESSEE objects to CITY's
appraiser's determination of the Fair Market Rental Value. In that case, LESSEE shall
give written notice to CITY of its objection within thirty (30) days of receipt of the
appraiser's report, and LESSEE shall then engage an independent State of Alaska certified
MAI appraiser (Member, Appraisal Institute) at LESSEE's expense to make an appraisal
of the Fair Market Rental Value in accordance with this Article 3.
If LESSEE'S appraisal determines a Fair Market Rental Value that varies from that
determined by CITY's appraisal by no more than twenty percent (20%), then the adjusted
rental rate shall be the average of the rental rates determined by the two appraisals. If
LESSEE'S appraisal determines a Fair Market Rental Value that varies from CITY's
appraisal by more than twenty percent (20%), then, unless CITY and LESSEE agree on a
rate themselves, the adjusted annual rental rate of the Leased Land shall be determined in
accordance with the arbitration provisions contained in Article 16 of this LEASE.
3.4 Effect ofLate Appraisal by CITY. If, for any reason, CITY does not complete the appraisal
or deliver a copy of the appraisal report to LESSEE one hundred twenty (120) days before
the Rental Adjustment Date, CITY may proceed to complete the appraisal or deliver a copy
of the appraisal report to LESSEE at any time thereafter. However, any such adjusted
annual rental rate shall not be effective until the annual payment due date immediately
following the date CITY delivers the appraisal report to LESSEE.
3.5 Appraisal by LESSEE. If for any particular Rental Adjustment Date, CITY fails to obtain
an appraisal of the Fair Market Rental Value or fails to deliver the appraisal report to the
LESSEE by the Rental Adjustment Date, the lease rate remains the same until the appraisal
is performed and shall not take effect until the next July 1. Alternatively, the LESSEE may
engage an independent State of Alaska certified MAI appraiser (Member, Appraisal
Institute) at LESSEE's expense to make an appraisal under the terms of this Article 3 and
submit a copy to CITY before the next rental payment due date. However, LESSEE must
notify CITY in writing within thirty (30) days following the Rental Adjustment Date of
LESSEE's election to obtain an appraisal. If CITY objects to LESSEE'S appraiser's
determination of the Fair Market Rental Value, CITY shall give written notice to LESSEE
of its objection within thirty (30) days of receipt of the appraiser's report, and CITY shall
then engage an independent State of Alaska certified MAI appraiser (Member, Appraisal
Institute) at CITY's expense to make an appraisal of the Fair Market Rental Value as of
the Rental Adjustment Date and in accordance with this Article 3. If the CITY's appraisal
determines a Fair Market Rental Value that varies from that determined by LESSEE'S
appraisal by no more than twenty percent (20%), then the adjusted rental rate shall be the
average of the rental rates determined by the two appraisals. If the CITY's appraisal
Page 5 of 29
determines a Fair Market Rental Value that varies from LESSEE'S appraisal by more than
twenty percent (20%), then, unless CITY and LESSEE agree on a rate themselves, the
adjusted annual rental rate of the Leased Land shall be determined in accordance with the
arbitration provisions contained in Article 17 of this LEASE.
3.6 Effective Date ofAdjusted Rental Rate. The adjusted annual rental rate established by this
Article 3 shall apply as of the Rental Adjustment Date if CITY provided a copy of the
appraisal report to LESSEE no later than one hundred twenty 120 days before the Rental
Adjustment Date. If the adjusted annual rental rate is based on CITY's late appraisal or
late delivery of the appraisal report to LESSEE, the adjusted rental rate shall be effective
beginning with the annual rental payment due date immediately following the date the
CITY delivers the appraisal report to LESSEE. Notwithstanding the above, the exercise
by either CITY or LESSEE of the objection procedure relating to rental adjustment
described in this Article 3 shall not postpone LESSEE's obligation to pay rent at the rate
established by CITY. LESSEE shall pay the amount of rent as established or adjusted by
CITY until the question of objection to the rental rate is finally resolved. At such time the
objection to the rental rate is resolved, the new rate will be effective on the next July 1.
3.7 Late Payment Charge. Rental payments not received by the due date shall bear a flat
monthly late fee of $12.50.
ARTICLE 4 - USE OF LEASED LAND
4.1 Use ofLeased Land. CITY has limited land available for lease. Use of the Leased Land
by LESSEE for a U.S. Army Recreation Camp and other government purposes, and uses
necessary and incidental thereto, has been determined by the City Council to be in the
public interest. Failure to continue to utilize the leased land for the purposes contemplated
by this LEASE, shall constitute a default in accordance with Article 9 of this LEASE.
4.2 Obligations of LESSEE. LESSEE may use the Leased Land only in accordance with
applicable CITY zoning code provisions and provided the following conditions are met:
a) LESSEE agrees to prohibit the use, keeping, storage, or disposal of Hazardous
Materials on the Leased Land except as permitted in Article 19 of this LEASE.
b) LESSEE shall not use the Leased Land in any manner or construct any facilities
thereon which would inhibit the use of adjacent or other lands.
c) LESSEE shall use the Leased Land only for the uses described in Section 4.1.
Page 6 of 29
d) LESSEE shall concur with Public Utility Easement attached hereto as Exhibit "C",
the CITY has sole and exclusive easement for the erection, construction,
installation and continued operation, maintenance, repair, alteration, inspection,
replacement, improvement and relocation, and removal of public utilities and their
related facilities and other attachments and equipment incidental thereto.
e) LESSEE shall, at all times, maintain its use and operations within the boundaries
of the Leased Land. There is no parking allowed near the Leased Land other than
in designated areas.
4.5 Tams and Other Service Fees. CITY shall have the right to make amendments to its
electric, sewer, and water tariffs, regulations and scheduled fees from time to time even if
those adjustments shall cost LESSEE more for its operations or use of public facilities, and
CITY is free to do so provided only that it does not impose any greater burden or higher
rate upon LESSEE than upon any other similar user of the public facilities.
4.6 Time for Payment of Utilities . LESSEE will pay for utilities related to operations on the
Leased Land and LESSEE's interest in this LEASE and improvements thereon, if any,
before such obligations become delinquent; provided, that LESSEE may, in good faith and
before such delinquency, contest any such charge or assessment.
ARTICLE 5 - UTILITIES AND RIGHTS OF ACCESS
5.1 Utilities. LESSEE, at LESSEE's sole cost and expense, shall provide for the extension of
public utilities to the Leased Land sufficient for LESSEE's intended operations, if
necessary. In so doing, LESSEE shall comply with all CITY regulations and requirements,
and the tariffs of the affected utilities, with respect to the construction of those utilities.
CITY agrees to cooperate and assist the LESSEE, through consultation and review, in
LESSEE's planning and engineering of those improvements. All utilities will be located
and sized in accordance with CITY's Master Plan for the area leased. All such construction
shall be in compliance with all applicable building, mechanical and fire codes. Utilities
constructed by the LESSEE within the public right-of-ways or within public utility
easements will normally be accepted and maintained by CITY or utility companies may be
used to serve other customers of LESSEE's without payment of fees or reimbursement of
construction cost to the LESSEE. However, this does not preclude several lessees from
agreeing to share the cost of constructing a utility to serve their facilities. CITY or other
utility company may determine that it would be to their benefit to oversize the utility or
install special fittings or equipment in order to serve other existing or future users. The
Page 7 of 29
additional direct costs of such oversizing shall be borne by CITY or other utility company.
Such costs shall be limited to the supplier's cost of the additional fittings, equipment, direct
labor, and equipment costs to complete the installation. The costs of oversizing pipe or
electrical conduit shall be limited to the difference between the supplier's price to provide
the size required to serve its facility and the price of the oversized material required by
CITY or utility company.
LESSEE shall not be entitled to any refund, rebate, or payments from CITY for any rent,
investment, or costs incurred by LESSEE with respect to any required permits for
construction or operation of LESSEE's facilities on the Leased Land. The LESSEE at its
own expense, shall obtain any required permits.
5.2 Third -Party Improvements. At the request of LESSEE, CITY shall, from time to time,
execute and deliver, or join in execution and delivery of, such documents as are
appropriate, necessary, or required to impose upon the Leased Land in accordance with the
terms of this LEASE covenants, conditions and restrictions providing for the granting of
uses of the Leased Land, or any part thereof, the establishment of party walls, the
establishment of mutual and reciprocal parking rights or rights of ingress or egress, or other
like matters (herein called "third -party improvements"), all of which are for the purpose of
the orderly development of the Leased Land as a commercial unit subject, however, to the
conditions that:
a) All such matters shall be limited to the Lease Term and shall terminate upon
termination of this LEASE for whatever reason.
b) Any such matters of a permanent nature extending beyond the Lease Term shall not
be granted without the prior written approval of CITY. In any of the foregoing
instances referred to in this Section, CITY shall be without expense therefor, and
the cost and expense thereof shall be borne solely by LESSEE.
c) At the expiration of the Lease Term (including any extended period) third -party
improvements on the Leased Land other than portable equipment shall become the
property of CITY without the payment of any compensation to LESSEE.
5.3 Easements. In order to provide for the orderly development of the Leased Land and
adjacent lands, it may be necessary, desirable or required that street, water, sewer, drainage,
gas, power line and other easements and dedications and similar rights be granted or
dedicated over or within portions of the Leased Land. As additional consideration for this
LEASE, CITY and LESSEE each shall, at the request of the other, join with each other in
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executing and delivering such documents from time to time and throughout the Lease Term
as may be appropriate, necessary, or required by the several governmental agencies
(including the City of Seward), public utilities and other users or tenants of CITY land for
the purpose of granting such easements and dedications; provided, however, that such
easements and dedications and similar rights do not unreasonably interfere with LESSEE's
operations. The costs of locating or relocating any public easements or restrictions of
record including any relocation of public road, railroad, utility, or other easements shall be
at the sole cost and expense of the parry requesting the relocation. CITY shall not refuse
reasonable requests for such relocations provided those relocations do not interfere with or
inhibit the overall development of CITY property or other public property. Any easements
or rights of access granted to LESSEE by CITY need not be exclusive to LESSEE. This
LEASE is accompanied by a Public Utility Easement which shall be concurred with at the
time of the execution of this lease and is attached hereto as Exhibits "B" and "C".
ARTICLE 6 - CONSTRUCTION BY LESSEE
6.1 Improvements on Leased Land. LESSEE shall have the right to erect, maintain, alter,
remodel, reconstruct, rebuild, build and/or replace buildings and other improvements on
the Leased Land, subject to the following conditions:
a) The cost of any construction, reconstruction, demolition, or of any changes,
alterations or improvements, shall be borne and paid for by LESSEE.
b) The Leased Land shall at all times be kept free of mechanic's and materialmen's
liens.
c) LESSEE shall provide CITY with a copy of all building plans and specifications
and a site development plan or plans (based on a recent survey) for the Leased Land
prior to commencement of construction.
d) LESSEE is solely responsible for resurveying and locating improvements on the
Leased Land in such manner not to violate building setback requirements or
encroach into rights -of -ways or easements. On completion of any improvements,
LESSEE shall provide CITY a copy of an as -built survey depicting the
improvements as completed on the Leased Land prior to issuance certificate of
occupancy.
e) CITY may, as contemplated by Alaska Statutes, give notice of non -responsibility
for any improvements constructed or effected by LESSEE on the Leased Land.
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f) LESSEE shall comply with all federal, state and local statutes and regulations with
respect to such construction, including but not limited to all applicable building,
mechanical, and fire codes. No permanent construction is allowed in any easement.
6.2 City Review of Construction. CITY shall have the right to review initial plans, including
those supplied to CITY under Section 6.1 hereof, and any future changes or additions to
LESSEE's facilities on the Leased Land, by reviewing the design thereof prior to the
commencement of construction. CITY shall have the right to comment upon that design,
and the parties can mutually agree to changes so as to avoid interference with public
operations, but the exercise of these rights shall not imply any obligation to do so in a
particular way. LESSEE shall construct the facility in accordance with final design
specifications approved by CITY. CITY's representatives may monitor the work and shall
have access to the site at all reasonable times. LESSEE shall be solely responsible for
completing all improvements according to LESSEE's plans and specifications and shall
bear all risk, responsibility, and liability for properly surveying the Leased Land before
construction and to place all improvements on the Leased Land without encroaching upon
any land, easements, rights -of -way, or setback requirements. LESSEE shall obtain the
usual and customary performance guarantees from its contractors.
ARTICLE 7 - RETURN OF LEASED LAND/SITE
7.1 Return ofLeased Land in Original Condition. Subject to the provisions of Article 11.1
facility conditions herein, any other termination of this LEASE for any reason; LESSEE
shall return the Leased Land to CITY in the same condition as at the commencement of
this LEASE, subject to normal, non -abusive use. The Leased Land shall be free of all
Hazardous Materials and contamination arising out of or resulting from or occurring
during LESSEE's operations or use of the Leased Land during this LEASE.
7.2 Return ofLeased Land in Different Condition. Notwithstanding the provisions of Section
7.1 above, upon termination of this LEASE for any reason LESSEE may return the Leased
Land in a re -contoured or graded clean, safe, and stable condition different from its original
condition provided CITY grants written approval of LESSEE's plans for development of
the Leased Land contours, including its plans for material extraction and final grade.
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ARTICLE 8 - FORCE MAJEURE
In the event either LESSEE or CITY is delayed from performance of any of its obligations
under this LEASE due to acts of nature, acts of the enemies of the United States of America,
sabotage, blockade, insurrection, riot, epidemic, fire, flood, explosion, earthquake/tsunami,
civil disturbance, or war, the time period wherein such performance is to occur shall be
extended by that amount of time necessary to compensate for the delay.
ARTICLE 9 - LESSEE'S ACTS OF DEFAULT
Each of the following shall be a "LESSEE Act of Default" under this LEASE and the terms
"acts of default" and "default" shall mean, whenever they are used in this LEASE, any one
or more of the following events:
9.1 Failure by LESSEE to pay promptly when due, and in no event later than sixty (60) days
from the due date thereof, the rent required to be paid under this LEASE.
9.2 Failure by LESSEE to observe, fulfill or perform any covenants, conditions or agreements
on its part to be observed or performed under this LEASE for a period of sixty (60) days
after written notice specifying such failure, requesting that it be remedied, and stating that
it is a notice of default, has been given to LESSEE by CITY; provided, however, that if
said default is such that it cannot be corrected within the applicable period, it shall not
constitute an act of default if corrective action is instituted by LESSEE within the
applicable period and diligently pursued until the default is corrected.
9.3 LESSEE's failure to comply with any laws or regulations of the United States, or of the
State of Alaska, or any conditions of any permits issued by agencies of the City of Seward,
the Kenai Peninsula Borough, the State of Alaska or of the United States Government
applicable to LESSEE's use of the Leased Land, pursuant to the regulations of such
agencies, for a period of sixty (60) days after written notice specifying such non-
compliance has been given by the agency charged with the enforcement of such laws,
regulations or permits to LESSEE; provided, however, if such non-compliance be such that
it cannot be corrected within the applicable period, it shall not constitute an act of default
if corrective action is instituted by LESSEE within the applicable period and diligently
pursued until the LESSEE is in compliance. Furthermore, if LESSEE shall contest such
alleged non-compliance through appropriate judicial or administrative channels, the time
period specified herein shall not commence until such proceedings are finally determined
provided such proceedings are diligently pursued; provided, however, that any such
extension of time shall not be effective if the effect of the interim administrative or judicial
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action is to cause a stoppage, interruption or threat to the activities of any person or entity
other than those of LESSEE.
9.4 Failure of LESSEE to concur with the Public Utility Easement attached hereto as Exhibits
"B" and "C" within ninety (90) days of the effective date of this agreement.
9.5 Failure of LESSEE to maintain its operations within the Leased Land or to keep the public
rights of way clear for a period of sixty (60) days after written notice specifying such
failure.
9.6 Failure to promptly pay when due any user or utility charges for a period of sixty (60) days
after written notice specifying such failure.
9.7 Failure of LESSEE to continue to operate the U.S. Army Recreation Camp consistent with
its current operational mission and scope, since the LEASE has been found in the public
interest due, in large part, to the benefits accrued to the community from employment of
local residents and the positive visitor impacts to the local economy for a period of sixty
(60) days after written notice specifying such failure.
ARTICLE 10 - REMEDIES FOR DEFAULT BY LESSEE
Whenever an act of default by LESSEE shall have occurred, and any applicable period for
giving notice and any opportunity to cure shall have expired, CITY shall have the following
rights and remedies all in addition to any rights and remedies that may be given to CITY
by statute, common law or otherwise:
10.1 CITY may distrain for rent due any of LESSEE's personal property which comes into
CITY's possession. This remedy shall include the right of CITY to dispose of personal
property distrained in any commercially reasonable manner. It shall be conclusively
presumed that compliance with the procedures set forth in the Alaska Uniform Commercial
Code (AS 45.29.601-.628) with respect to sale of property shall be a commercially
reasonable disposal.
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10.2 Government requires written notice thirty (30) days and legal process before the CITY may
re-enter the Leased Land and take possession thereof and, except for any personal property
of LESSEE which CITY has waived its right to distrain under Section 10.1 above, remove
all personal property of LESSEE from the Leased Land. Such personal property may be
stored in place or may be removed and stored in a public warehouse or elsewhere at the
cost of LESSEE.
10.3 In addition to the above, CITY may:
a) Declare this LEASE terminated upon written agreement by both parties;
b) Collect any and all rents due or to become due from subtenants or other occupants
of the Leased Land;
c) Recover an amount to be due immediately on breach equal to the unpaid rent for
the entire remaining term of this LEASE.
10.4 If LESSEE does not immediately surrender possession of the Leased Land after
termination by CITY and upon demand by CITY, CITY may forthwith enter into and upon
and repossess the Leased Land and expel LESSEE without being deemed guilty in any
manner of trespass and without prejudice to any remedies which might otherwise be used
for arrears of rent or breach of covenant.
10.5 No expiration or termination of this LEASE shall expire or terminate any liability or
obligation to perform of LESSEE's which arose prior to the termination or expiration
except insofar as otherwise agreed to in this LEASE.
10.6 Each right and remedy of CITY provided for in this LEASE shall be cumulative and shall
be in addition to every other right or remedy provided for in this LEASE or now or hereafter
existing at law or in equity or by statute or otherwise, and the exercise or beginning of the
exercise by CITY of any one or more of the rights and remedies provided for in this LEASE
or now or hereafter existing at law or in equity or by statute or otherwise shall not preclude
the simultaneous or later exercise by CITY of any or all other rights or remedies provided
for in this LEASE or now or thereafter existing at law, or in equity or by statute or
otherwise.
10.7 No delay or omission to exercise any right or power accruing following an act of default
shall impair any such right or power or shall be construed to be a waiver thereof, but any
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such right and power may be exercised from time to time and as often as may be deemed
expedient.
ARTICLE 11 - TITLE TO IMPROVEMENTS INSTALLED BY LESSEE
11.1 Real Property Improvements. If the improvements on the leased land are maintained in as
good or better condition than at the start of this lease term, the City will accept the facilities
upon termination of this lease. Otherwise, the Leased Land is to be completely cleaned
and restored to its original condition upon termination of this Lease that is, the condition
existing prior to any operations by LESSEE under this or any prior agreement.
11.2 Personal Property. Upon termination of this LEASE for any reason other than default by
LESSEE, LESSEE may, but need not, promptly remove, in no event later than ninety (90)
days from the termination of the LEASE, trade fixtures and equipment from the Leased
Land provided that LESSEE shall repair any damages to the Leased Land caused by such
removal.
ARTICLE 12 - ASSIGNMENT OR SUBLEASE
12 Assignment of Lease or Subleasing. The parties recognize that this LEASE has been
determined to be in the public interest by the City Council of CITY for the reasons set forth
in the approving Resolution. The rights and duties created by the LEASE are personal to
LESSEE and CITY has granted the LEASE in reliance upon the individual character and
financial capability of LESSEE. Therefore, LESSEE shall not assign this LEASE without
CITY's prior written consent, in CITY's sole discretion. LESSEE may not sublease all or
any portion of the Leased Land or buildings or improvements located thereon.
ARTICLE 13 - LESSEE'S DUTY TO DEFEND
13 If any action of the Government's employees or agents in the exercise of this LEASE results
in damage to the real property, the Government will, in its sole discretion, either repair
such damage or make an appropriate settlement with the Owner. In no event shall such
repair or settlement exceed the fair market value of the fee title to the real property at the
time immediately preceding such damage. The Government's liability under this clause is
subject to the availability of appropriations for such payment, and nothing contained in this
agreement may be considered as implying that Congress will at a later date appropriate
funds sufficient to meet deficiencies. The provisions of this clause are without prejudice
to any rights the Owner may have to make a claim under applicable laws for any damages
other than those provided for herein.
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ARTICLE 14 - CITY'S DUTY TO DEFEND/INDEMNIFY
14 CITY shall defend, indemnify and hold LESSEE harmless from any and all liability or
claims for damages, including personal injuries, death and property damage arising from
the sole negligence or willful acts or omissions of CITY, its officials, employees, agents,
or contractors.
ARTICLE 15- INSURANCE
15 The parties acknowledge that the LESSEE is an entity of the United States government,
and has a program of self -insuring all risks of general liability and part or all of LESSEE's
risks of loss or damage. LESSEE shall require any contractor performing work on or about
the Leased Land to obtain comprehensive commercial general liability insurance.
ARTICLE 16 - CONDEMNATION
16 If part but not all of the Leased Land is condemned for public use, LESSEE shall make a
good faith determination as to whether or not the taking of the part of the Leased Land
designated for condemnation will prevent it from continuing to operate on the Leased Land.
If LESSEE determines in good faith that the condemning of such part of the Leased Land
will prevent it from continuing to operate on the Leased Land, LESSEE may notify CITY
in writing to this effect, and this LEASE shall then be terminated for all purposes effective
fifteen (15) days from the date LESSEE sends such notice to CITY, or at such other later
date as LESSEE shall specify in its notice, and such termination shall be treated in the same
manner as a termination at the expiration of the term of this LEASE. LESSEE shall, as a
condition precedent to such termination, remove all encumbrances, debts and liens to
which the Leased Land is subject. If at the time of such partial taking for public use,
LESSEE determines that such partial taking will not prevent it from continuing to operate,
then LESSEE and CITY shall negotiate an equitable and partial abatement of the rent
beginning to be effective on the actual date when LESSEE is effectively prevented from
utilizing the condemned land.
ARTICLE 17 - ARBITRATION
17.1 Arbitration.
a) Disputes between the parties with respect to the performance of this LEASE that
cannot be resolved by the parties, shall be submitted to an independent arbitration
panel for a resolution pursuant to the provisions of the Alaska Uniform Arbitration
Act (AS 09.43.010 et. seq.), as it now exists or may hereafter be amended from
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time to time, and judgment on the award may be entered in any Superior Court in
the State of Alaska. Notwithstanding the foregoing, arbitration shall not be
applicable to claims or disputes involving a requested remedy having a value of
more than One Hundred Thousand Dollars and No/100s ($100,000) (exclusive of
interest and costs). All demands for arbitration and all answering statements thereto
that include any claim must contain a statement that the total sum or value in
controversy, as alleged by the party making such demand or answering statement,
is not more than One Hundred Thousand Dollars and No/100s ($100,000.) The
arbitrator will not have jurisdiction, power, or authority to consider or make
findings (except to deny jurisdiction) concerning any claim, counterclaim, dispute
or other matter in question where the amount in controversy of any such claim,
counterclaim, dispute or matter is more than One Hundred Thousand Dollars and
No/100s ($100,000). The costs and expenses of arbitration shall be shared equally
by the parties, and each party shall bear its own attorney's fees and costs.
b) Arbitration procedures shall be applicable only to contract, negligence, and similar
claims arising from or related to this LEASE, and shall not be used to resolve or
determine any claim based upon fraud, intentional misrepresentation, nor any claim
based on conduct that is a felony crime in the State of Alaska.
c) The arbitration shall be conducted by one arbitrator if the parties can agree to an
arbitrator. If the Parties are not able to agree upon the selection of an arbitrator,
within [twenty] days of commencement of an arbitration proceeding by service of
a demand for arbitration, each parry shall select an arbitrator within ten days who
shall serve as a neutral arbitrator and the two designated arbitrators shall select a
third neutral arbitrator within twenty days of their selection of the parties cannot
agree on a third arbitrator.
d) Arbitration hearings shall be conducted in Anchorage, Alaska or such other location
as the parties may agree. Each parry shall produce at the request of the other parry,
at least thirty (30) days in advance of such hearing, all documents to be submitted
at the hearing and such other documents as are relevant to the issues or likely to
lead to relevant information.
e) In deciding the claim or dispute, the arbitrator shall follow applicable Alaska law,
and the written decision shall be supported by substantial evidence in the record.
Failure to apply Alaska law, or entry of a decision that is not based on substantial
evidence in the record, shall be additional grounds for modifying or vacating an
arbitration decision.
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ARTICLE 18 - MAINTENANCE AND REPAIRS
18.1 Normal Maintenance. During the entire term of this LEASE and every extension hereof,
if any, LESSEE shall, at LESSEE's sole cost, risk and expense, maintain the Leased Land,
including any improvements placed thereon by LESSEE, in as good condition as received
or constructed by LESSEE, subject to normal, non -abusive use. CITY, at CITY's sole
option and expense, may, prior to the commencement of construction by LESSEE, perform
maintenance and preventative work on the Leased Land, exclusive of improvements placed
thereon by LESSEE, in order to prevent erosion, mitigate damage to plants and animals, or
prepare the Leased Land for eventual development by LESSEE or others by grading, filling
or contouring the Leased Land. Any such work performed by CITY shall be at CITY's sole
expense and risk unless LESSEE agrees, in advance and in writing, to share such expense
and risk. LESSEE shall maintain in first class condition at all times all fire, pollution and
other protective equipment, if any are placed on Leased Land.
18.2 Safety Issues. CITY may notify LESSEE in writing of any deficiencies in the performance
of LESSEE's maintenance responsibilities as they relate to public health or safety and
LESSEE shall promptly within thirty (30) days of receipt of such notice advise CITY in
writing of its proposed schedule for performance of any work necessary to cure such
deficiencies.
18.3 Cost ofRepairs. Should LESSEE dispute the necessity of any maintenance work as being
necessary or advisable or reasonable to protect the public facilities on adjacent land, it may
submit the matter to arbitration; provided, however, that pending the decision of the
arbitrator it shall fully comply with the maintenance requests. If an arbitration award
should ultimately find that the repairs were not necessary then LESSEE may either deduct
from future rental payments the cost of such repairs or be reimbursed therefor. In deciding
whether repairs requested by CITY or required by an engineering report are necessary, the
arbitration panel is to give primary consideration to the safety and welfare of the Seward
facilities and the citizens of Seward in light of the highest standards in the industry.
If any facility or service provided by CITY to the Leased Land shall become inadequate
due to changes in environmental control standards or should any facility require updating
or improvement by reason of a change in LESSEE's use of the Leased Land or operations
therefrom, LESSEE shall either construct such improvements at LESSEE's own cost or
reimburse CITY for such work at the option of CITY.
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ARTICLE 19 - ENVIRONMENTAL CONCERNS
19.1 Hazardous Materials.
a) Condition of Site. LESSEE has had full opportunity to examine the site for the
presence of any Hazardous Material and accepts the Leased Land in "as is"
condition. LESSEE may elect, at LESSEE's sole cost, to conduct a baseline soils
test prior to execution of this LEASE.
b) Release of CITY. Any other provision of this LEASE to the contrary
notwithstanding, LESSEE releases CITY from any and all claims, demands,
penalties, fines, judgments, liabilities, settlements, damages, costs or expenses
(including, without limitation, attorney's fees, court costs, litigation expenses, and
consultant and expert fees) arising prior to, during, and after the term of this
LEASE, and resulting from the use, keeping, storage or disposal of Hazardous
Material on the Leased Land by LESSEE or its predecessors in interest, or arising
out of or resulting from LESSEE's operations at the Leased Land or the operations
of its predecessors in interest at the Leased Land except for those claims arising out
of CITY's sole negligence or intentional misconduct. This release includes, without
limitation, any and all costs incurred due to any investigation of the Leased Land
or any cleanup, removal or restoration mandated by a federal, state or local agency
or political subdivision or by law or regulation.
c) Use ofHazardous Materials on the Site.
i) LESSEE shall not cause or permit any Hazardous Material to be brought
upon, kept or used in or about the Leased Land except for such Hazardous
Material as is necessary to conduct LESSEE's authorized use of the Leased
Land.
ii) Any Hazardous Material permitted on the Leased Land as provided in this
paragraph, and all containers therefor, shall be used, kept, stored and
disposed of in a manner that complies with all Environmental Laws or other
laws or regulations applicable to such Hazardous Material.
iii) LESSEE shall not discharge, leak or emit, or permit to be discharged, leaked
or emitted, any material into the atmosphere, ground, ground water, sewer
system or any body of water, if such material (as reasonably determined the
cognizant governmental authority) does or may, pollute or contaminate the
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same, or may adversely affect the (a) health, welfare or safety of persons,
whether located on the Leased Land or elsewhere; or (b) condition, use or
enjoyment of the Leased Land or any other area or personal property.
iv) LESSEE hereby agrees that it shall be fully responsible for all use, storage
and disposal of Hazardous Material kept or brought on the Leased Land by
LESSEE, its authorized representatives and invitees, and LESSEE shall
give immediate notice to CITY of any violation or potential violation of the
provisions of this subparagraph
e) Operator. For all purposes, LESSEE shall be deemed the operator of any facility
on the Leased Land.
f) Hazardous Material Defined. As used in this LEASE, Hazardous Material means
any substance defined as such by applicable federal law, such as CERCLA, RCRA,
or TSCA, or DERP.
19.2 Permits and Reporting.
a) Permits Required by Other Governmental Agencies. LESSEE shall obtain all
permits or approvals required by any applicable law or regulation. Copies of all
such permits shall be provided to CITY prior to LESSEE commencing work under
this LEASE. LESSEE shall promptly make all reports to any federal, state or local
government or agency required by any permit or Environmental Law, including
reports of any spill or discharge of Hazardous Material. The CITY, through the
City Manager, may order LESSEE to immediately cease any operations or activities
on the Leased Land if the same is being carried out without necessary permits, in
violation of the terms of any permit or Environmental Law, or contrary to this
LEASE.
b) Correspondence With and Reports to Environmental Agencies. LESSEE shall
immediately provide CITY with copies of all correspondence and notice, including
copies, of all reports between LESSEE and any state, federal or local government
or agency regulating Hazardous Material which relates to LESSEE's operations on
or use of the Leased Land.
ARTICLE 20 - ESTOPPEL CERTIFICATES
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Either parry shall at any time and from time to time upon not less than ten (10) days' prior
written request by the other parry, execute, acknowledge, and deliver to such parry, or to
its designee, a statement in writing certifying that this LEASE is un-amended and in full
force and effect (or, if there has been any amendment approved by both parties thereof,
that the same is in full force and effect as amended and stating the amendment or
amendments), that there are no defaults existing (or, if there is any claimed default, stating
the nature and extent thereof); and stating the dates to which the rent and other charges
have been paid in advance.
ARTICLE 21 - CONDITIONS AND COVENANTS
All the provisions of this LEASE shall be construed to be "conditions" as well as
"covenants," as though the words specifically expressing or imparting covenants and
conditions were used in each separate provision.
ARTICLE 22 - NO WAIVER OF BREACH
No failure by either CITY or LESSEE to insist upon the strict performance by the other of
any term, covenant or condition of this LEASE or to exercise any right or remedy
consequent upon a breach thereof, shall constitute a waiver of any such breach or of such
terms, covenants or conditions. No waiver of any breach shall affect or alter this LEASE,
but each and every term, covenant and condition of this LEASE shall continue in full force
and effect with respect to any other then existing or subsequent breach.
ARTICLE 23 - TIME OF THE ESSENCE
Time is of the essence of this LEASE and of each provision.
ARTICLE 24 - COMPUTATION OF TIME
The time in which any act provided by this LEASE is to be done by shall be computed by
excluding the first day and including the last, unless the last day is a Saturday, Sunday or
a holiday, and then it is also excluded.
ARTICLE 25 - SUCCESSORS IN INTEREST
Each and all of the terms, covenants and conditions in this LEASE shall inure to the benefit
of and shall be binding upon the successors in interest of CITY and LESSEE.
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ARTICLE 26 - ENTIRE AGREEMENT
This LEASE contains the entire agreement of the parties with respect to the matters covered
by this LEASE, and no other agreement, statement or promise made by any party which is
not contained in this LEASE shall be binding or valid.
ARTICLE 27 - GOVERNING LAW
This LEASE shall be governed by, construed and enforced in accordance with the laws of
the State of Alaska. The terms of this LEASE are subject in all respects to the Charter and
Code of Ordinances of CITY in effect on the date of this LEASE, and as they may be
hereafter amended, including without limitation, Chapter 7.05 of the Seward City Code.
ARTICLE 28 - PARTIAL INVALIDITY
If any provision of this LEASE is held by a court of competent jurisdiction to be invalid,
void or unenforceable, the remainder of the provisions shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
ARTICLE 29 - RELATIONSHIP OF PARTIES
Nothing contained in this LEASE shall be deemed or construed by the parties or by any
third person to create the relationship of principal and agent or of partnership or of joint
venture or of any association between CITY and LESSEE; and neither the method of
computation of rent, nor any other provisions contained in this LEASE nor any acts of the
parties, shall be deemed to create any relationship between CITY and LESSEE other than
the relationship of lessee and lessor.
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ARTICLE 30 — INTERPRETATION
The language in all parts of this LEASE shall in all cases be simply construed according
to its fair meaning and not for or against CITY or LESSEE as both CITY and LESSEE
have had the opportunity to seek assistance of counsel in drafting and reviewing this
LEASE.
ARTICLE 31 - CAPTIONS
Captions of the articles, paragraphs and subparagraphs of this LEASE are for convenience
and reference only, and the words contained therein shall in no way be held to explain,
modify, amplify or aid in the interpretation, construction or meaning of the provisions of
this LEASE.
ARTICLE 32 - AMENDMENT
This LEASE is not subject to amendment except in writing executed by both parties hereto.
ARTICLE 33 - NOTICES
All notices, demands or requests from one party to another shall be delivered in person or
be sent by mail, certified or registered, postage prepaid, to the addresses stated in this
Article and to such other persons and addresses as either parry may designate. Notice by
mail shall be deemed to have been given at the time of mailing.
All notices, demands and requests from LESSEE to CITY shall be given to CITY at the
following address:
City Manager
CITY OF SEWARD
PO Box 167
Seward, Alaska 99664-0167
All notices, demands or requests from CITY to LESSEE shall be given to LESSEE at the
following address:
United States Army Corps of Engineers, Alaska District
P.O. Box 6898
JBER, Alaska 99506-0898
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Each party shall have the right, from time to time, to designate a different address by notice
given in conformity with this Article.
ARTICLE 34 - FIRE PROTECTION
LESSEE shall at its sole cost, risk and expense provide fire protection to its operations on
the Leased Land, and fire prevention to industry standards for risks to adjacent facilities
such that those risks are minimized. LESSEE shall continue to provide and maintain
industry accepted standards of fire protection such that the City of Seward's ISO rating is
not degraded by reason of LESSEE'S operation. The parties agree that with the rapid
expansion of technology in the field of fire prevention and control LESSEE's obligations
hereunder may vary during the term of this LEASE.
IN WITNESS WHEREOF, the parties hereto have executed this Lease the dates herein
set forth.
CITY:
CITY OF SEWARD
James Hunt
City Manager
Date:
LESSEE:
UNITED STATES OF AMERICA
Acting by and through the
SECRETARY OF THE ARMY
Michael D. Coy
Chief, Real Estate Branch
Real Estate Contracting Officer
U.S. Army Corps of Engineers, Alaska
District
Date: 2v .S � e � 20
Page 23 of 29
ATTEST:
Johanna Kinney
City Clerk
STATE OF ALASKA )
) ss.
THIRD JUDICIAL DISTRICT )
THIS IS TO CERTIFY that on this day of , 2017, before me, the
undersigned, a Notary Public in and for the State of Alaska, personally appeared James Hunt,
known to me and to me known to be the City Manager for the City of Seward, Alaska, and
authorized to execute documents on its behalf, and is the individual named in and who executed
the foregoing document on behalf of the City of Seward for the uses and purposes therein set forth.
WITNESS my hand and notarial seal the day and year first hereinabove written.
Notary Public in and for Alaska
My Commission Expires:
STATE OF ALASKA )
) ss.
THIRD JUDICIAL DISTRICT )
THIS IS TO CERTIFY that on this ag day of , 2017, before me, the
undersigned, a Notary Public in and for the State of Alaska, personally appeared
, known to me and to me known to be the Real tjka e. Cn7rt,1rQr-Jyyj 04�-rcef
of (ASACE - , and authorized to execute documents on its behalf, d is the
individual named in and who executed the foregoing document on behalf of the
SNcm, 4 for the uses and purposes therein set forth.
Page 24 of 29
WITNESS my hand and notarial seal the day and year first hereinabove written.
A � M4 N 00�
otary Public in and for Alaska
My Commission Expires: r b
Page 25 of 29
EXHIBIT "A"
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EXHIBIT "B"
CITY OF SEWARD
SEWARD, ALASKA
all :11[all]IIIIWMA_V14►�1:1►11
KNOW ALL MEN BY THESE PRESENTS, City of Seward, PO Box 167, Seward, Alaska 99664 ("Grantor"), for
good and valuable consideration, the receipt of which is hereby acknowledged, does hereby grant,
bargain, sell, convey, set -over, and deliver unto the City of Seward, a municipal corporation organized and
existing under the laws of the State of Alaska, and to its successors, assigns, licensees, and permittees,
("Grantee"), a sole and exclusive easement for the erection, construction and installation, and continued
operation, maintenance, repair, alteration, inspection, replacement, improvement and relocation, and
removal of public utilities and other related facilities and other attachments and equipment incidental
hereto, through, over, in, under, and across the land of Grantor, situated in the Seward Recording District,
Third Judicial District, State of Alaska, and more particularly described as follows:
The east 30 feet and the east 36 feet of the north 46 feet, and the northeast triangle west of the afore
described easement, being 18 feet in height and 38 feet in width of Lot 9A, Fort Raymond Subdivision,
Replat No. 1, Section 34, Township 1 North, Range 1 West of the Seward Meridian.
The existing building shown in the northeast corner is allowed as being consistent with the use and
enjoyment of the easement. Any further exterior additions to the building that are within the easement
shall require approval for consistency with the current NESC.
See Exhibit "C"
And specifically, there is hereby granted to the Grantee the sole and exclusive right to erect, construct,
install, continue to operate, maintain, repair, alter, inspect replace, improve, relocate, and remove such
public utilities and their related facilities through, over, in, under, and across, the aforesaid premises as
may from time to time be necessary or desirable for the exclusive use, occupation, and enjoyment of such
easement, including the right of ingress and egress to said premises, and the right to cut and keep clear
of all trees, shrubbery, undergrowth and other obstructions on said premises as may be reasonably
required for the construction, installation, operation, and maintenance of such public utility facilities.
TO HAVE AND TO HOLD the same to Grantee, its successors, assigns, licensees, and permittees, FOREVER.
Grantor agrees that all facilities which may be installed on the above described premises at Grantee's
expense, or at the expense of its successors, assigns, licensees, and permittees, shall remain the property
of the Grantee, or the property of such successors, assigns, licensees, or permittees, as the case may be,
and removable at Grantee's option.
Grantor covenants that he is the owner of the above -described premises and that the said premises are
free and clear of encumbrances and liens of whatsoever character, except those held by the following
persons, which have agreed to this public utility easement through execution of a Lease Agreement
between City of Seward, Alaska and United States of America acting by and through the Secretary of the
Army, effective July 1, 2017:
Department of the Army
US Army Engineer District, Alaska
PO Box 6898
JBER, Alaska 99506-0898
IN WITNESS WHEREOF, Grantor(s) has set his hand and seal, or has caused these presents to be executed
by his duly authorized representative of agent, all as of the day of 1201
GRANTOR/GRANTEE/PROPERTY OWNER: CITY OF SEWARD
By: James Hunt
Title: City Manager
Date:
STATE OFALASKA )
) ss:
THIRD JUDICIAL DISTRICT)
THIS IS TO CERTIFY that on this day of , 201 , before me, the
undersigned, a Notary Public in and for the State of Alaska, duly commissioned and sworn as such,
personally appeared, , known to me to be the
individual named in and who executed the foregoing document, and he acknowledged to me that he
signed and sealed the same as his (their) free and voluntary act and deed for the uses and purposes therein
set forth.
WITNESS my hand and notarial seal the day and year first hereinabove written.
Notary Public in and for Alaska
My Commission Expires:
Recorded in the Seward Recording District
AFTER RECORDING RETURN TO:
Community Development Department
City of Seward
PO Box 167
Seward, AK 99664
EXHIBIT "C"
WZMMS AU. (Undwnlepatl) QKA
...........
34
w
I A2
I
1. Users generating sewage with a BOD and
SS loading in excess of mg/1 (upon a deter-
minatio.n by the utility manager that the
concentration and characteristics of the
sewage will not cause a detrimental effect
upon the sewer system and/or treatment
plant [BOD = "Biological Oxygen Demand"
and SS = "Suspended Solids I
1 Tank Truck Operators- Fresh sewage, or
waste from portable or chemical toilets,
provided the utility manager determines the
waste will not be detrimental to the sewer
system and/or treatment plant.
NOTE:
It is prohibited to discharge into the city's
sewer system, septic tank waste or any
waste containing toxic or other materials
that could cause the city's discharge to
violate the EPA or DEC discharge permit.
3. Recreational Vehicles: Individual RV
owners utilizing city -owned or approved
dump sites
Public and private campground operators
[Operators must maintain sufficient records
to compute a monthly payment, and such
records shall be made available to the city
upon request.]
4. Ship's Sewage:
5. Sewer Service Connection Fee:
6. Sewer Service Inspection Fee: This
bfl
shall e charged o fr services installed
anyone other than the city.
7. Unauthorized Connection or Discharge
into the City Sewer System:
the cost of testing
9
WIT
$1.06 per day Per RV, camper or trailer permit, not
including tent campers.
Q� �M 11
Installed at property owner's expense. Any work
performed by the city will be charged at total cost,
includmV _natexaW
and equipment PLUS a $150.64 connection fee.
Per Occurrence $945.46
PLUS Cost of repair, restoration or cleanup by city
City of Seward Sewer Tariff -Per2017Budget, Effective January], 2017. Page 4-3