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HomeMy WebLinkAboutRes2012-025 Sponsored by: I -lent CITY OF SEWARD, ALASKA RESOLUTION 2012 -025 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO A SETTLEMENT AGREEMENT IN CITY OF SEWARD v. GILLESPIE, CASE NO. 3AN-10-7550 CI, WITH REGARD TO CONDEMNATION OF TRACT B OF DIECKGRAFF - GILLESPIE SUBDIVISION FOR THE NORTH FOREST ACRES LEVEE/ROAD PROJECT, IN CONSIDERATION FOR PAYMENT OF $150,000, IN ADDITION TO $71,720 ALREADY PAID, CONSTRUCTION OF A NEW DRIVEWAY BY THE CITY, AND CONVEYANCE OF A PORTION (APPROXIMATELY 17,000 SQUARE FEET) OF TRACT 5 OF FOREST ACRES SUBDIVISION IN SEWARD, ALASKA WHEREAS, the City of Seward completed Phase I of the west Forest Acres levee in 2002, and began the process of acquiring permits for Phase II, known as the North Forest Acres Levee /Road Project (the "Project "); and WHEREAS, the City of Seward spent many years developing the design and location for a levee /road to benefit the people of Seward; and WHEREAS, in 2008 the Seward City Council accepted the alignment of the Project as described in the Finding of No Significant Impact and authorized the administration to pursue environmental permitting and to negotiate with property owners to acquire easements, rights -of -way and /or ownership of parcels of land affected by the Project; WHEREAS, in 2009 the US Army Corps of Engineers issued a permit to the City of Seward to construct the Project in accordance with the conditions of the permit; WHEREAS, at the direction of the City, appraisals were made of the fair market value of the parcels of land, all of which were undeveloped parcels of land, and each appraisal received an appraisal review; and WHEREAS, acquisition of a public use easement across Tract B was determined to be necessary to move forward with the construction of the Project; and WHEREAS, the City was unable to reach an agreement with the owners of Tract B for purchase of a public use easement and ultimately filed a Declaration of Taking in May 2010 to al low the construction to occur within the timeframe requested by the Corps of Engineers; and WHEREAS, litigation involves uncertainty and risk to both parties and the City finds that it is in the public interest to enter into a settlement agreement to resolve the litigation, according to the ,,� terms set forth in the agreement presented at this meeting; and CITY OF SEWARD, ALASKA RESOLUTION 2012 -025 WHEREAS, Seward City Code Section 7.05.120 permits the disposition of real property by negotiation; and WHEREAS, Seward City Code Section 7.05.125 requires notice and a public hearing prior to the acquisition or disposition of real property; and WHEREAS, the essential terms and conditions contained in the settlement agreement (the "Settlement Agreement ") have been available for public inspection for 10 days in the office of the City Clerk. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF OF SEWARD, ALASKA that: Section 1. The City Council finds it is in the best interest of the City of Seward to purchase Property by negotiation for the North Forest Acres Levee /Road Project subject to conditional terms contained in the agreement presented at this meeting. Section 2. The City Manager is hereby authorized to enter into the Settlement Agreement in substantially the form presented at this meeting and to proceed with the platting process with the goal of satisfying the conditions stated in the Settlement Agreement. The City Manager is authorized take all such action necessary under the agreement to complete the purchase. Section 3. The City Council finds that the subdivision requirements of Seward City Code Title 16 do not apply to the City's acquisition of a portion of Tract B because, among other things, such real property will be owned by the City, is being acquired for the Project, and subdivision development requirements are not necessary or desirable for the Project. Section 4. Funds in the amount of $150,000.00 are hereby appropriated from the North Forest Acres Levee /Road Fund fund balance to the Land expense account no. 666 - 6664 -5910 to be paid into escrow in accordance with the Settlement Agreement presented at this meeting. Section 5. This resolution shall take effect (30) days following passage and posting. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 23 day of April 2012. THE CITY OF SEWARD, ALASKA 1 tori David Seaward, ayor CITY OF SEWARD, ALASKA RESOLUTION 2012 -025 him AYES: Keil, Casagranda, Terry, Seaward NOES: Valdatta, Shafer ABSENT: Bardarson ABSTAIN: None ATTEST: (Or it J fi hanna Kinney ity Clerk, CMC (City Seal) <1„ ` 4 c a t ua : c �, d 5 • • • °. a .0 �w tkS COUNCIL AGENDA STATEMENT Meeting Date: April 23, 2012 From: Jim Hunt, City Manager Agenda Item: Approval of Settlement Agreement in Case No. 3AN -10- 7550 CI, relating to Tract B, Dieckgraeff - Gillespie Replat BACKGROUND & JUSTIFICATION: The City of Seward recently completed most of the work on the North Forest Acres levee /road project. This project began in the late 1990's when the City began the process of working with state and federal agencies to obtain permitting, and resulted from a flood mitigation task force developed at the request of FEMA, following major flood events in Seward during the past twenty years. In efforts to obtain the necessary permits, the City fought to construct the levee as far to the north as possible, in order to minimize the impact on property owners and provide as much protection of property as possible. The agencies preferred the levee to be further south, in order to minimize the impact on wetlands and fish habitat. This conflict resulted in a decade -long effort to determine the exact alignment of the levee /road that would gain acceptance from all agencies involved in the project. Eventually the current route was approved and permits were issued. In 2009 the City began to acquire property interests consistent with the permitted route. Appraisals were made of the fair market value of the interests in the undeveloped parcels of land to be acquired, and each appraisal received an appraisal review. The City worked with the various landowners to reach agreement and to compensate the owners. However, the City was unable to reach agreement with the owners of Tract B and litigation was necessary to acquire a public use easement. On March 22, 2010, the Seward City Council passed Resolution 2010 -025 authorizing the City Manager and City Attorney to institute eminent domain proceedings, including the use of a declaration of taking, against Tract B and its owners, in order to proceed with construction of the North Forest Acres Levee /Road Project. The resolution further authorized a second peer- reviewed appraisal to be conducted by an independent appraiser not previously involved in appraising this property on behalf of the City. The resolution authorized the City to pay the higher of two independent, peer - reviewed appraisals. In May 2010, the City filed a Declaration of Taking in Superior Court, along with payment of $71,720.00, which included the value of the easement and the damages to the remainder resulting from the easement. (This amount is ten percent higher than the appraised value of $65,200 as determined by Black - Smith, Bethard & Carlson.) The owners of Tract B have now agreed to a settlement of the eminent domain proceedings. The owners expressed their desire to "square-off' their portion of Tract B to the south of the easement. The settlement agreement presented at this meeting authorizes a land exchange in fee, following replatting, whereby the City will trade a portion of its existing property east of Tract B in exchange for transfer in fee to the City of most of the area intended as an easement and the north remainder of Tract B. A portion of the area in the south squared -off area would be a public use easement. A drawing attached as Exhibit B illustrates the proposed land exchange. In addition to the land exchange, the agreement provides that the City will apply for the authority to construct a new driveway on the border of Tract B and the unsubdivided property owned by Gillespie to the south of Tract B. The agreement further provides that the City will deposit into escrow the amount of $150,000, of which $50,000 will be paid within 5 days. The rest of the escrowed amount will be released to Gillespies upon completion of the replat and fee transfer of titles reflecting the land exchange. The City will be responsible for platting costs, but will not be responsible for any development costs that may be required on the property to be transferred or retained by Gillespies. The settlement resolves the eminent domain lawsuit, in addition to all claims between the parties, including attorney fees and costs. Each side is to bear its own costs and fees. CONSISTENCY CHECKLIST: Where applicable, this resolution is consistent with the Seward City Code, Charter, Comprehensive Plans, Land Use Plans, Strategic Plan and City Council Rules of Procedures. INTENT: This resolution requests additional funding of $150,000, and provides a final settlement of the eminent domain proceedings. ATTORNEY REVIEW: Yes FISCAL NOTE: Funding for this acquisition will come from the North Forest Acres Levee /Road Project. Approved by Finance Department RECOMMENDATION: Approve Resolution 2012 -025, authorizing a settlement agreement regarding the Tract B eminent domain litigation and an additional appropriation of $150,000.