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HomeMy WebLinkAbout10272014 City Council Packet .2. .1. A. .1. A- _1. _l. _1. _1- _1. 1. !. :. __,1, ;:. :. :. 1. , I I , , , I 1 I I I , I , I I A A` AA` A A` ArA` A A` A�A' ArA` AA' AP' /CAA' AAA' A'A' A A' A A` A,A' �A A` A A` A A` t:,✓ !w1 ✓ <1"✓ \ I \ ✓ \I <0,1 Lr✓ find `n✓ Vd `n✓ Vd Z YJ AAA' A�, Council ` ' 001 AA,, Seward City ,�. ,.., AAA ItioV , � Agenda Packet I4'A. w AAA. Nilie Nei Vii✓ P} A AA RAJ `AA__�,A W A A '''' I vs, AAA A te/ 1. 1. Norti • . W ArA .....01 . AMY/ � .. (C) ki...... 09 r 1. . A!A, (!/0 42 W A A' 111116401141e I t r oe AAA 4,, 2. 1 1. tr✓ A A 4 4Ai✓ Vii "A kW 1. 1. v., AAA` it A A AAA AtwJ IAA, October 2 7, 2014 AW AAN` W At A ' Ned 0 A AAA AA/A €0 orpt City Council Chambers Beginning at 7:00 p.m. :. 1. 1. 1. 1. 1. 1. 1. 1- 1. 1. 1. 1. 1. 1. 1. 1. 1. 'A i I I I I 'A I I I I l I I `A A` ,A A` ,A A, A A' A A' `A_N'` `A,A', `A,A', `A_A,� `A__A,` `A,_A,` `A.__A,, `A,A,` `A.,_A' `A A, Ar A` AA,` A,A,, �M'W� VY W e VII V, Vim✓ V�Y/ �Y/ A/ MY Vf'1V �A VA A The City of Seward, Alaska r�"rt ,. CITY COUNCIL MEETING AGENDA a�j tt � fn ,),744t-,-., 1? {Please silence all cellular phones and pagers during the meeting} ,c;asc October 27, 2014 7:00 p.m. Council Chambers Jean Bardarson 1. CALL TO ORDER Mayor Term Expires 2015 2. PLEDGE OF ALLEGIANCE Marianna Keil A. SWEAR IN NEWLY ELECTED OFFICIALS Vice Mayor Term Expires 2016 3. ROLL CALL 4. CITIZEN COMMENTS ON ANY SUBJECT EXCEPT THOSE Ristine Casagranda ITEMS SCHEDULED FOR PUBLIC HEARING [Those who Council Member have signed in will be given the first opportunity to speak Time is Term Expires 2016 limited to 3 minutes per speaker and 36 minutes total time for this agenda item.] Christy Terry 5. APPROVAL OF AGENDA AND CONSENT AGENDA Council Member [Approval of Consent Agenda passes all routine items indicated by Term Expires 2015 asterisk (*). Consent Agenda items are not considered separately unless a council member so requests. In the event of such a request, David Squires the item is returned to the Regular Agenda] 411110., Council Member Term Expires 2015 6. SPECIAL ORDERS, PRESENTATIONS AND REPORTS Dale Butts Proclamations and Awards Council Member Term Expires 2016 1. Certificate of Appreciation for Seward Music &Arts Festival Organizers Pg. 3 Iris Darling 2. Certificate of Appreciation for the Resurrection Bay Historical Council Member Society .Pg. 4 Term Expires 2015 B. Chamber of Commerce Report C. City Manager's Report James Hunt D. Other Reports and Presentations City Manager 1. Presentation by Elliot Jackson on an ice skating rink in Seward. Johanna Kinney City Clerk Eric Wohlforth City Attorney City of Seward, Alaska Council Agenda October 27, 2014 Page 1 7. PUBLIC HEARINGS— A. Resolutions Requiring Public Hearing staid 1. Resolution 2014-086, Authorizing The City Manager To Enter Into Two Lease And Sale Agreements With The Alaska Railroad Corporation (ARRC) For An Exchange Of Uplands Along Fourth Avenue And Tidelands Containing The Small Boat Harbor East Breakwater...Pg. 5 8. UNFINISHED BUSINESS —None 9. NEW BUSINESS A. Resolutions 1. Resolution 2014-087, Approving The City Of Seward's Calendar Year 2015 City Legislative Priorities. (Clerk's Note: There are substitute versions for council consideration included in the agenda packet) Pg. 46 2. Resolution 2014-088, Establishing The City Of Seward's Calendar Year 2015 State Legislative Priorities. (Clerk's Note: There are substitute versions for council consideration included in the agenda packet) Pg. 53 3. Resolution 2014-089, Establishing The City Of Seward's Calendar Year 2015 Federal Legislative Priorities Pg. 60 4. Resolution 2014-090, Rescinding Resolution 2014-077 And Authorizing The Purchase Of A Previously Owned 2012 Dodge Durango As A Replacement Electric Department Vehicle For An Amount Not To Exceed $21,000 And Appropriating Funds .P . 64 . g C. Other New Business Items *1. Approval of the September 8, 2014 Regular City Council Meeting Minutes Pg. 75 2. Nominate, elect, and swear-in a council member as Vice-Mayor Pg. 85 3.Mayor appoint a Kenai Peninsula Economic Development District Representative pg. 86 4 Direct individual Boards & Commissions to give periodic reports to the City Council *5. Cancel the November 24, 2014 City Council Meeting. Pg. 87 *6. Non-objection to the new liquor license application for Zudy's Café Pg. 88 10. INFORMATIONAL ITEMS AND REPORTS (No Action Required) A. Extra Mile Proclamation.. .Pg. 101 11. COUNCIL COMMENTS 12. CITIZEN COMMENTS 13. COUNCIL AND ADMINISTRATION RESPONSE TO CITIZEN COMMENTS 14. ADJOURNMENT City of Seward, Alaska Council Agenda October 27, 2014 Page 2 CERTIFICATE OF A On behalf of the communittj,the ail) Council would like to recognize the following individuals for their contributions as organizers of the 11th Annual Seward Music&Arts Festival: Gail Burnard General Director/PR Ginger Allen Melissa Mitchell Silent Auction Coordinator Music Director Samantha Clemens Lars Olson Facility Maintenance Event Logistics &Set-Up Cindy Ecklund Dana & Dave Paperman Coffee Cart Kids'Area Coordinator Jennifer Headtke Fiona Ritter Mural Project Merchandise Ordering&Design Linnea Hollingsworth Stacy Schaffer Event Treasurer Beer Garden Coordinator Jeremy Horn Micheley Svabik Merchandise Sales Band Lodging Coordinator Liz Leech Bethany Waggoner Vendor Coordinator Art Show Dan Linkhart Theresa Waldron Event Logistics &Set-Up Volunteer Coordinator Michael Mahmood Abby Wentworth Event Logistics &Set-Up Art Director DATED this 27t1.day of October,2014 THE CITYOF SEWARD,ALASKA Jean Bardarson,Mayor zi, 0 75 GO 7 7ii VD ' ''.. 4-1-+ '> <3 .''"'' 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Df " t 0 („) -E T- U 4- .42', '0 .E g iiid Lt Sponsored by: Hunt CITY OF SEWARD,ALASKA RESOLUTION 2014-086 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING THE CITY MANAGER TO ENTER INTO TWO LEASE AND SALE AGREEMENTS WITH THE ALASKA RAILROAD CORPORATION (ARRC) FOR AN EXCHANGE OF UPLANDS ALONG FOURTH AVENUE AND TIDELANDS CONTAINING THE SMALL BOAT HARBOR EAST BREAKWATER WHEREAS, for at least ten years the Alaska Railroad Corporation (ARRC) has had plans for a Mariner's Landing commercial development on its uplands between the J and F dock fire lanes; and WHEREAS, in part, the plans have not been implemented pending the relocation of the USCG facilities formerly at the head of F-float, which occupied land owned by both the ARRC and the City of Seward, which land has now been vacated; and WHEREAS, the city also owns a small sliver of land along Fourth Avenue adjoining the west boundary of the ARRC property, a portion of which is currently leased to the ARRC and sublet to James Pruitt for parking at the Holiday Inn Express hotel; and law WHEREAS,neither city parcel is developable as a stand-alone lot; and WHEREAS, the ARRC desires to acquire these lots, do the replatting necessary to vacate the lot line and allow construction on that part of the property, and to develop the entire area; and WHEREAS, the city requires clear access through fire lanes/pedestrian access to both J and F floats, and a utility easement along Fourth Avenue to repair and upgrade utilities as necessary; WHEREAS, as part of the South Harbor Expansion, the city moved the Small Boat Harbor breakwater eastward onto ARRC lands near the coal dock; and WHEREAS, the city built a fish cleaning station at J-dock, and an oil recycling facility along the J-dock fire lane, both on ARRC property; and WHEREAS, the city has a lease from the ARRC for the fish cleaning station and oil recycling facility, holds a reciprocal lease to the ARRC for the portion of Lot 1 Block 6 (sliver) used for parking, and has a separate lease for the ARRC of the breakwater lands; and WHEREAS, the reciprocal leases act as consideration for each other, and the city pays rent to the ARRC for the breakwater lands; and 5 CITY OF SEWARD,ALASKA RESOLUTION 2014-086 WHEREAS, the city desires to have long term control of each of these lands for harbor use purposes; and WHEREAS,the ARRC and city administration have negotiated terms of the attached agreement to accomplish the purposes stated above by asking the City Council to authorize fee simple transfer of title from the City to the ARRC of Lots 1 and 2, Block 6, Seward Small Boat Harbor Subdivision in exchange for long term renewable rent free leases from the ARRC to the city of the breakwater lands, fish cleaning station, and oil recycling facility. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA that: Section 1. The City Manager is authorized to enter into the two lease and sale agreements with the Alaska Railroad Corporation, in substantial form as presented at this meeting and incorporated by reference, for the parcels of land identified in the leases. Section 2. This resolution shall take effect 30 days after adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27th day of October, 2014. THE CITY OF SEWARD,ALASKA Jean Bardarson,Mayor AYES: NOES: ABSENT: ABSTAIN: ATTEST: Johanna Kinney, CMC City Clerk (City Seal) b Council Agenda Statement Meeting Date: October 27, 2014 , SEA 9 From: Jim Hunt, City Manager u "`0o Agenda Item: To enter into lease and sale agreements between ta,P tAs1 the City of Seward and the Alaska Railroad Corporation (ARRC), transferring title from the City to ARRC for certain uplands along 4th Ave in exchange for long term leases of uplands at J-Dock fish cleaning station and oil recycling facility, and tidelands and adjacent containing the Small Boat Harbor east breakwater BACKGROUND &JUSTIFICATION: ARRC wishes to improve and further develop its uplands along 4th Avenue in the Boat Harbor area, and the City wishes to acquire long term rent free leases for the Harbor's east breakwater, the J- Dock fish cleaning station, and nearby oil recycling facility. The City also wishes to maintain public and emergency access to J-Dock and the Boat Harbor across ARRC lands at the existing fire lane, and utility easements along 4th Avenue for repairs and upgrades to utilities as are or may become necessary. Currently the City's lands along 4th Ave. (the sliver) are used for sidewalk and parking (public parallel parking to the south and leased to ARRC and sublet to Holiday Inn Express to the north), and also include the City's portion of the old Coast Guard building location. By themselves, these parcels are not suitable for commercial development. Joined with the adjacent ARRC parcels, the potential for development is enhanced. To accomplish these goals administration and the ARRC have negotiated the contracts attached to the resolution, summarized as follows: • City deeds parcels 14733026 and 14733027 (City portion of old Coast Guard building lot and the "sliver"along 4th Avenue)to ARRC; • City acquires 95 year lease to the tidelands where the east harbor breakwater is built; • Current lease fees for that parcel of$11,067/year or equivalent value in gravel at $3/cubic yard is rescinded; • City acquires 35 year lease for the fish cleaning station and oil recycling facility, with an option to renew for another 35 years, at which point the lease can be renegotiated if the City desires; • City maintains through covenants fire lane access at J-Dock and 10' utility easements along 4th Avenue. This Agreement is in the city's best interest to dispose of otherwise undevelopable land in exchange for necessary harbor related infrastructure, and to enhance economic development viability of neighboring ARRC lands. fir.., INTENT: To implement the land disposal and lease as described in the Resolution and Purchase and Sale Agreement attached to the resolution. CONSISTENCY CHECKLIST: Yes No N/A Comprehensive Plan (p. 18): Economic Development: Update and 1. expand infrastructure for commercial and industrial properties that are X currently undeveloped or underdeveloped. 2. Strategic Plan (document source here): X 3. Other (list): X FISCAL NOTE: Approved by Finance Department: ATTORNEY REVIEW: Yes X No RECOMMENDATION:, •RQ,%0 .ov 2-0 VA - O g To authorize the City Manager to execute the lease and sale agreements with the Alaska Railroad Corporation, in substantial form as attached to and incorporated by reference in the Resolution, for the parcels of land identified in the leases. GROUND LEASE Between ALASKA RAILROAD CORPORATION and CITY OF SEWARD CONTRACT N0. 9846 ci INDEX "% ARTICLE 1 LEASED PREMISES AND TERM 1.01 Leased Premises 1.02 Reservation of Minerals 1.03 Improvements Owned by Lessor 1.04 Improvements Owned by Lessee 1.05 Lease Term 1.06 [RESERVED] 1.07 Effect on Prior Lease Document 1.08 Lessor's Right of Access for Environmental Purposes 1.09 Termination for Change of Premises Use. ARTICLE 2 RENTS ARTICLE 3 QUIET ENJOYMENT ARTICLE 4 LESSEE'S COVENANTS 4.01 Use of Leased Premises 4.02 Taxes and Utilities 4.03 Construction or Removal of Improvements, Additions and Alterations 4.04 Repair and Maintenance 4.05 Observance of Laws; Environmental Provisions 4.06 Inspection and Repair by Lessor 4.07 Waste and Wrongful Use 4.08 Setback 4.09 Liens 4.10 Indemnification 4.11 Costs and Expenses of Lessor 4.12 Holdover 4.13 Responsibility Upon Damage to or Destruction of Property ARTICLE 5 INSURANCE 5.01 Workers' Compensation 5.02 Liability Insurance 5.03 Policy Provisions 5.04 Proof of Insurance ARTICLE 6 [RESERVED] `' .► ARTICLE 7 ASSIGNMENTS, MORTGAGES, SUBLEASES AND SUBDIVISION 7.01 Limitations on Assignment 7.02 Lessee's Right to Assign 7.03 [RESERVED] 7.04 Right to Sublet 7.05 Subdivision of Leased Premises ARTICLE 8 ARBITRATION AND APPRAISAL PROCESS 8.01 Appointment of Arbitrators and Conduct of Arbitration 8.02 Special Qualifications of Arbitrators 8.03 Judicial Review of Arbitration Decision ARTICLE 9 DEFAULT AND DEFEASANCE 9.01 Events of Default 9.02 Notice and Right to Cure 9.03 Nonwaiver 9.04 Right of Lessor to Protect Against Default 9.05 Lessor's Remedies 9.06 Application of Sums Collected by Lessor ARTICLE 10 GENERAL PROVISIONS 10.01 Lessor's Right to Entry, Inspection and Repair 10.02 Notices 10.03 Covenants and Conditions 10.04 Integration and Amendments 10.05 Approvals of Lessor 10.06 Survival and Severability 10.07 Binding Effect 10.08 Lessor's Authority to Convey Fee Title 10.09 Powers of Lessor as Public Corporation 10.10 Captions ARTICLE 11 DUTIES UPON TERMINATION OR EXPIRATION 11.01 Surrender of Leased Premises 11.02 Removal of Improvements Upon Termination 11.03 Abandonment of Lessee's Property 11.04 Liability for Cleanup Expenses 11 ARTICLE 12 EXECUTION AND MEMORANDUM OF LEASE `""' 12.01 Execution and Counterparts 12.02 Recordation of Memorandum of Lease Nord GROUND LEASE THIS GROUND LEASE (herein called "this Lease") is made on the day executed by the last signatory hereto, by and between the ALASKA RAILROAD CORPORATION (herein called "Lessor"), a public corporation created pursuant to AS 42.40, whose mailing address is P.O. Box 107500, Anchorage, Alaska 99510-7500, and THE CITY OF SEWARD, a home rule city (herein called "Lessee"), whose mailing address is P.O. Box 167, Seward, Alaska 99664. RECITALS A. Lessor owns and has agreed to lease to Lessee a parcel of uplands, tidelands, and submerged lands located within the Alaska Railroad Seward Reserve, as more specifically described on Schedule 1 attached to, and for all purposes made a part of, this Lease. B. Lessor has agreed to lease the above-referenced parcel of land to Lessee for a period of ninety-five (95) years pursuant to the terms of this Lease. C. The property subject to this Lease has been under a long-term lease, originally designated as ARRC Contract No. 8670, dated November 17, 2003, between Lessor and Lessee, a Memorandum of which is recorded, at document number 2003-002328-0 within the records of the Seward Recording District. The purpose of this Lease is to enable Lessee to continue the operations of improvements within the Seward Small Boat Harbor, a public facility whose operation is a vital element of local business and economic development and boating activity. D. The parties intend that the consideration given by Lessee for this Lease shall consist of Lessee's transfer to Lessor of fee simple interest in the land described in Schedule 2 attached to and for all purposes made a part of this Lease. The parties acknowledge that said transfer constitutes full and fair consideration for this Lease. ARTICLE 1 LEASED PREMISES AND TERM 1.01 Leased Premises. Lessor, for and in consideration of the covenants and conditions hereinafter specified to be performed and observed by Lessee, hereby leases to Lessee, and Lessee hereby leases from Lessor, the vacant, unimproved uplands, tidelands, and submerged lands situated in the Seward Recording District, Third Judicial District, State of Alaska, more particularly described on Schedule 1 attached to and for all purposes made a part of this Lease, together with all rights, easements, privileges, both subterranean and vertical, but subject to the reservation contained in paragraph 1.02 of this Lease (herein called the "Leased Premises"). 1.02 Reservation of Minerals. All oil, gas, coal, geothermal resources and minerals of whatever nature in or under the above-described land are excluded from the Leased Premises and ARRC Contract No. 9846 13 Page-I reserved to Lessor. Notwithstanding the foregoing, Lessee shall have the right, subject to the terms of this Lease, to use earth materials on or in the above-described land to a depth not to exceed twenty (20) feet below the surface, and to move and recontour such materials on the Leased Premises. During the term of this Lease, Lessor shall not have the right to enter on the surface of the Leased Premises, without Lessee's prior consent, for the purpose of mining and/or extracting such oil, gas, coal, geothermal resources, or other minerals and shall not mine and/or extract the same by any means at a depth less than twenty-five (25) feet below the surface of the Leased Premises. If Lessor mines and/or extracts such oil, gas, coal, geothermal resources, or other minerals, the mining and/or extraction shall not interfere with Lessee's business and activities on the Leased Premises, parking or access to the Leased Premises. The foregoing authority for Lessee to utilize earth materials (including gravel) is limited to use of said materials on the Leased Premises. 1.03 Improvements Owned by Lessor. There are no improvements owned by Lessor on the Leased Premises at the outset of this Lease. 1.04 Improvements Owned by Lessee. The following described improvements ("Lessee's Improvements") are situated on and are part of the Leased Premises and are, for purposes of this Lease, the property of the Lessee and shall remain so throughout the term of this Lease: Existing harbor improvements located in the vicinity of and to the west of the existing breakwater constructed by the United States Army Corps of Engineers. The parties hereby agree that Lessee's Improvements include any additional above surface improvements constructed or placed on the Leased Premises by Lessee during the Lease Term (as hereinafter defined). 1.05 Lease Term. Subject to Paragraph 1.06, this Lease shall be and continue in full force and effect for a term of ninety-five (95) years (the "Lease Term") commencing on 2014, and expiring on , 2109 unless earlier terminated as provided in this Lease. 1.06 [RESERVED] 1.07 Effect on Prior Lease Document. Upon the commencement date of this Lease as provided in Paragraph 1.05, the provisions of the prior lease document described in Recital C above shall be of no further force and effect, except as to liabilities accrued prior to such date, which shall thereupon become liabilities under this Lease and be governed by the terms hereof. 1.08 Lessor's Right of Access for Environmental Purposes. In addition to any right of access described elsewhere in this Lease, Lessee hereby agrees to provide Lessor, and its authorized representatives and agents, access to the Premises at all reasonable times for the purposes of assessing, sampling, or otherwise determining the current environmental condition of ARRC Contract No. 9846 1 LA Page-2 the Premises and, if deemed necessary or prudent by Lessor in its sole discretion, conducting or implementing any interim or final cleanup measures or other action protective of human health and the environment, whether or not such action is required by a regulatory agency with jurisdiction in the matter. The provisions of subparagraph 4.06.E of this Lease shall apply to determine the respective obligations of Lessor and Lessee for any environmental condition addressed under the foregoing right of access. 1.09 Termination for Change of Premises Use. Lessor reserves the right to terminate this Lease upon twelve (12) months' notice at any time during the term of the Lease if the Premises and adjacent submerged lands are no longer used or needed for a small boat harbor or similar facility, or such other use as may be approved by Lessor pursuant to paragraph 4.01 of this Lease. In the event of such termination, Lessor shall compensate Lessee for the fair market value of Lessee's Improvements, if any, as of the date Lessor gives Lessee notice of such termination. Fair market value of Lessee's Improvements shall be agreed to by the parties or determined as set forth in Article 8 of this Lease. ARTICLE 2 RENTS The consideration to be paid by Lessee for this Lease and all rights hereunder shall consist of Lessee's transfer to Lessor of a fee simple interest in the land described in Schedule 2. Said conveyance of land, once complete and irrevocable, shall satisfy in full any and all rents which are or may become due during the term of this Lease and during the term of the previous lease described in Recital B above. ARTICLE 3 QUIET ENJOYMENT Upon timely payment by Lessee of all consideration and other payments required to be paid by Lessee under this Lease, and upon full and faithful observance and performance by Lessee of all of its covenants contained in this Lease, and so long as such observance and performance continues, Lessee shall peaceably hold, occupy, use and enjoy the Leased Premises during the Lease Term without hindrance or interruption by Lessor or anyone lawfully claiming by, through, or under Lessor. ARRC Contract No. 9846 1 Page-3 ARTICLE 4 LESSEE'S COVENANTS 4.01 Use of Leased Premises. Lessee specifically agrees that for the term of this Lease, it shall use the Leased Premises for no other purpose other than a public small boat harbor and marina. Any change in use will require prior written approval of Lessor of a written request by Lessee for such change in use. Lessor's approval of a change in use under this paragraph 4.01 shall not be unreasonably withheld, but may be made subject to reasonable conditions. 4.02 Taxes and Utilities. Lessee will pay for utilities and taxes, if any, related to operations on the Leased Premises 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. 4.03 Construction or Removal of Improvements, Additions and Alterations. A. Project Construction. Lessor acknowledges that Lessee intends to use the Leased Premises, and maintain the improvements thereon, in accordance with the Seward Small Boat Harbor Planning and Development Guide approved by the Seward City Council in its Resolution 2003-84 (the "Project"). Lessee previously approved the improvements within and near the Leased Premises (breakwater and other harbor improvements) which have been constructed and are now complete. Lessee shall give Lessor reasonable prior notice of the proposed construction plans for any future phases of the Project located on the Leased Premises. Such notice shall be given as soon as reasonably practicable but in any event before the solicitation of bids or proposals from potential contractors or before beginning such work with Lessee's own employees. B. Future Work. Lessee shall not begin any Significant Work without first obtaining the prior written approval of Lessor with respect to such work and to the preliminary plans for such work, if any, and to the final plans and specifications for such work. For purposes of this Lease, "Significant Work" means all work on the Leased Premises other than the Project costing more than $25,000.00 which (1) involves the excavation, filling, or other alteration of the grade or drainage of the Leased Premises, or (2) involves the construction, demolition, or removal on or from the Leased Premises of any improvement, any addition or alteration. C. Requirements regarding Future Work. The preliminary plans and the final plans and specifications for Significant Work shall be prepared by a licensed architect or engineer and shall include, but not be limited to, a detailed plot plan, an itemized estimate of the total cost of such work, and a timetable for completion. No approval by Lessor or by its architects or engineers of such preliminary plans or final plans and specifications shall be deemed a warranty or other representation by any of them that the improvements, additions, alterations, or other work contemplated thereby are legal, safe, or sound or constitute the highest and best use of the Leased ARRC Contract No. 9846 Page-4 Premises. All of such work by Lessee on the Leased Premises shall be supervised by a licensed architect or engineer. Lessee hereby acknowledges that, except as provided in paragraph 11.02 of this Lease with respect to removal of improvements upon expiration of the Lease Term or earlier termination of this Lease, Lessor has not authorized or required and does not authorize or require Lessee to improve the Leased Premises in any manner that permits Lessor's interest in and title to the Leased Premises to become subject to the liens of Lessee's mechanics and materialmen. Any and all alterations, additions or improvements made pursuant to this paragraph are subject to and shall comply with paragraph 4.05 of this Lease. 4.04 Repair and Maintenance. Lessee shall, at Lessee's expense and without notice from Lessor at all times during the Lease Term, keep all of Lessee's Improvements now or hereafter built on the Leased Premises in good order, condition, maintenance, operability, and repair and of a neat, clean, and pleasing appearance. 4.05 Observance of Laws; Environmental Provisions. A. General Compliance. Lessee, at all times during the Lease Term, at its own expense, and with all due diligence, shall observe and comply with all laws, ordinances, rules, regulations and administrative agency or courts orders which are now in effect or may later be adopted by any governmental authority, and which may be applicable to the Leased Premises or any improvement on it or any use of it. B. Environmental Laws. In furtherance and not in limitation of subparagraph 4.05A of this Lease, Lessee must, at its own expense, comply with all laws, ordinances, regulations and administrative agency or court orders relating to health, safety, noise, environmental protection, waste disposal, hazardous or toxic materials, and water quality or air quality. In the event any discharge, leakage, spillage, emission, contamination or pollution of any type occurs upon or from the Leased Premises during the Lease Term or any holdover thereafter, Lessee shall immediately notify Lessor and shall, at Lessee's own expense, clean and restore the Leased Premises to the satisfaction of Lessor and any governmental body or court having jurisdiction of the matter. C. Hazardous Materials on Leased Premises. Lessee shall not cause or permit any Hazardous Material, as defined in subparagraph 4.05F of this Lease, to be brought upon, kept or used in or about the Leased Premises by Lessee, its agents, employees, contractors or invitees unless such Hazardous Material is necessary or useful to Lessee's authorized use of the Leased Premises and will be used, kept and stored in a manner that complies with all laws regulating any such Hazardous Materials so brought upon or used or kept in or about the Leased Premises. D. Disclosure. At all times during the term of this Lease Lessee shall maintain records of the names and amounts of all Hazardous Materials, as defined in subparagraph 4.05F of this Lease, or any combination thereof which were stored, used or disposed of on the Leased Premises by Lessee during the term of this Lease. Lessee shall disclose such records to Lessor (1) upon request; and (2) upon expiration or earlier termination of this Lease. Lessee shall at the ARRC Contract No. 9846 Page-5 beginning of this Lease and on January 1 of each year thereafter during the term of this Lease disclose to Lessor the names and amounts of all Hazardous Materials, or any combination thereof, which Lessee intends to store, use or dispose of, or to cause to be stored, used or disposed of, on the Leased Premises after the time of the disclosure. E. Environmental Indemnity. To the extent permitted by law, Lessee agrees to indemnify, hold harmless and defend Lessor against all liability, cost and expense (including, without limitation, any fines, penalties, diminution in value of the Leased Premises, assessment and clean-up costs, judgments, litigation costs and attorneys' fees) incurred by or levied against Lessor as a result of Lessee's breach of this paragraph 4.05 or as a result of any discharge, leakage, spillage, emission, contamination or pollution on or discharged from the Leased Premises, during the Lease Term, without regard to whether such liability, cost or expense arises during or after the Lease Term of this Lease, subject to appropriation; provided, however, that Lessee shall not be required to indemnify Lessor under this paragraph if the parties agree or a court of competent jurisdiction determines by clear and convincing evidence that such liability, cost or expense was caused (i) prior to the commencement of the Lease Term or (ii) directly and solely by the active negligence of Lessor. The foregoing indemnity shall survive the expiration or earlier termination of this Lease. F. "Hazardous Material." For purposes of this Lease, the term "Hazardous Material" means any hazardous or toxic substances, material or waste, including but not limited to those substances, materials and wastes listed in the U.S. Department of Transportation Hazardous Materials Table (49 CFR § 172.101) or by the U.S. Environmental Protection Agency as hazardous substances (40 CFR Part 302), or as hazardous wastes (40 CFR Part 261.3), or that qualify as hazardous substances pursuant to Alaska Statutes 46.09.900(4), and amendments thereto, or such substances, materials and wastes that are or become regulated under any applicable local, state or federal law. G. Environmental Testing. Lessee agrees that it shall be solely responsible for all costs and expenses associated with the performance of environmental testing of the Leased Premises, which may be required at Lessor's sole discretion, upon the expiration or other termination of this Lease. Such environmental testing, conducted by a recognized engineering or environmental consulting firm acceptable to Lessor at Lessor's sole discretion, shall be the basis for determining the extent of any environmental impairment caused by the Lessee's use and occupancy of the Leased Premises. H. Permits Relating to Navigable Waters, Tidelands and Wetlands. In furtherance and not in limitation of subparagraph 4.05A of this Lease, Lessee shall obtain all necessary permits from any governmental entity, including but not limited to the U.S. Army Corps of Engineers, with authority over the occupancy or construction of improvements on or adjacent to navigable waters and tidelands or wetlands. Lessee shall give Lessor notice of its proposed application for any such permit thirty (30) days before submission of the application to the governmental entity and obtain Lessor's approval of the proposed work as provided in paragraph ARRC Contract No. 9846 t CZ Page-6 voillaw 4.03 of this Lease. If Lessor fails to respond to the notice of proposed application given by Lessee within the thirty(30) day period, Lessor shall be deemed to have approved the proposed work. Responsibility for Costs. In the event Lessor shall make any expenditures or incur any obligations for the payment of money in connection with this paragraph 4.05 including, but not limited to, attorneys' fees for instituting, prosecuting or defending any action or proceeding, such sums paid, obligations incurred and costs, all with interest at the maximum rate of interest allowed under applicable Alaska law, shall be deemed to be additional rent due hereunder and shall be paid by Lessee to Lessor within ten (10) days of the rendering of a bill or statement to Lessee therefor. 4.06 Inspection and Repair by Lessor. Lessee shall repair, maintain and make good all conditions required under the provisions of this Lease to be repaired or maintained within thirty (30) days from the date of written notice from Lessor with regard to such matters unless otherwise provided for in this Lease. Notwithstanding the foregoing, where Lessor notifies Lessee of any condition on the Leased Premises that in the reasonable opinion of Lessor substantially endangers either the person or property of Lessor or a third party, or human health or the environment, Lessee shall commence as soon as possible any repairs or maintenance necessary to eliminate said substantial endangerment and shall continue its efforts to cure the associated condition within a reasonable time period thereafter. The initial notice to Lessee by Lessor of a condition posing substantial endangerment under the preceding sentence may be verbal, but Lessor shall provide " .. written notice of same to Lessee as soon as reasonably possible. If Lessee refuses or neglects to repair or maintain the Leased Premises as required under the terms of this Lease after written demand by Lessor to Lessee, then Lessor, without prejudice to any other right or remedy it has under this Lease or otherwise, may perform such maintenance work or make such repairs without liability to Lessee for any loss or damage that may accrue to Lessee's merchandise or other property or Lessee's business by reason thereof. Upon completion of any such repair or maintenance, and no later than ten (10) days after presentation of a bill therefor, Lessee shall pay Lessor's reasonable costs for making such repairs or performing such maintenance plus fifteen percent (15%) to cover Lessor's overhead. 4.07 Waste and Wrongful Use. Lessee shall not commit or suffer any strip or waste of the Leased Premises or any unlawful, unsafe, improper, or offensive use thereof or any public or private nuisance thereon. 4.08 Setback. Lessee shall observe all setback lines applicable to the Leased Premises and shall not construct or maintain any structure whatever between any boundary of the Leased Premises and any setback along such boundary. 4.09 Liens. Lessee shall not commit or suffer any act or neglect whereby the Leased Premises or the interest of Lessor or Lessee therein at any time during the Lease Term may become subject to any attachment, execution, lien, charge, or other encumbrance, other than a statutory lien for nondelinquent real property taxes or assessments, and shall indemnify and hold ARRC Contract No. 9846 'q Page- 7 Lessor harmless against all losses, costs, and expenses, including reasonable attorneys' fees, paid or incurred by Lessor in connection therewith. Lessee shall not incur any cost or expense with respect to the Leased Premises which, if not timely paid, may subject the Leased Premises or the interest of Lessor or Lessee therein to any lien or other encumbrance. 4.10 Indemnification. A. Lessee shall indemnify and hold Lessor harmless from and against any and all claims arising from (1) Lessee's use of the Leased Premises, or from the conduct of Lessee's business, or from any activity, work or things done, permitted or suffered by Lessee in or about the Leased Premises or elsewhere; (2) any breach or default in the performance of any obligation on Lessee's part to be performed under the terms of this Lease; (3) any negligence of Lessee, or any of Lessee's agents, contractors, customers, employees, or any person claiming by, through or under Lessee; and (4) any accident on or in connection with the Leased Premises, or any fire thereon, or any nuisance made or suffered thereon. Lessee shall further indemnify and hold Lessor harmless from and against all costs, attorneys' fees, expenses and liabilities incurred in the defense of any proceeding brought against Lessor by reason of any such claim. Lessee, upon notice from Lessor, shall defend any of the above-described claims at Lessee's expense by counsel satisfactory to Lessor. Lessee, as a material part of the consideration to Lessor, hereby assumes all risk of damage to property or injury to persons, in, upon or about the Leased Premises, arising from any cause and Lessee hereby waives all claims in respect thereof against Lessor. The provisions of this subparagraph 4.08.A shall not apply if the parties agree or a court of competent jurisdiction determines that such claims or liabilities are caused directly and solely by the active negligence of Lessor. B. Lessee acknowledges that, before entering this Lease, it has fully inspected or been provided with an opportunity to fully inspect the Leased Premises and all documents in the possession of Lessor relating to the condition of the Leased Premises, and to test or examine all conditions of or on the Leased Premises. Lessee further acknowledges that, at the time this Lease is entered into and on the basis of the foregoing inspection or opportunity to inspect, Lessee is as knowledgeable about the condition of the Leased Premises as Lessor and, on that basis, assumes all risks relating to the condition of the Leased Premises, including but not limited to latent defects that may be unknown both to Lessee and Lessor at the time this Lease is entered into. Lessor represents and warrants that it has provided Lessee with an opportunity to inspect all documentation maintained by Lessor in its records concerning the condition of the Leased Premises. 4.11 Costs and Expenses of Lessor. Lessee shall forthwith pay to Lessor all costs and expenses, including reasonable attorneys' fees, which are (1) paid or incurred by Lessor but are required to be paid by Lessee under any provision of this Lease; (2) paid or incurred by Lessor in enforcing any covenant of Lessee contained in this Lease, in protecting itself against or remedying any breach thereof, in recovering possession of the Leased Premises or any part thereof, or in Nod collecting or causing to be paid any delinquent rents, real property taxes, assessments, or rates; or ARRC Contract No. 9846 �O Page-8 (3) incurred by Lessor in connection with any action in any respect related to this Lease, the Leased Premises, or Lessee's actions or omissions on the Leased Premises, other than a condemnation action filed by or against Lessee, to and in which Lessor is made a party but not adjudicated to be at fault. The term "costs and expenses" as used in this Lease shall include but not be limited to all of Lessor's out-of-pocket expenditures attributable to the matter involved. Except as otherwise expressly provided herein, all costs and expenses of Lessor shall be payable by Lessee to Lessor forthwith after mailing or personal delivery of statements therefor to Lessee and shall bear interest from the date which is ten (10) days after the date of such mailing or personal delivery at the rate of ten and one-half percent(10'/2%) per annum. 4.12 Holdover. If Lessee remains in possession of the Leased Premises after expiration of the Lease Term without the execution of a new lease or of an extension of this Lease, and in such a manner as to create a valid holdover tenancy, and if no notice of termination has been delivered by Lessor to Lessee, Lessee shall be deemed to occupy the Leased Premises only as a tenant at will from year-to-year, upon and subject to all of the provisions of this Lease which may be applicable to a year-to-year tenancy, including but not limited to the provisions of Article 2 and of paragraph 11.02 of this Lease. 4.13 Responsibility Upon Damage to or Destruction of Property. In the event a Lessee Improvement situated on the Leased Premises is destroyed or damaged by fire or other casualty, Lessee shall comply in full with one of the following conditions within ninety (90) days of such destruction or damage (or within such other time period as is mutually agreed to in writing): A. Lessee may repair, rebuild, or otherwise reinstate the damaged improvement(s) in a good and substantial manner and in substantially the same form as it previously existed. In such event, the Lease shall continue in full force and effect. B. Lessee may repair, rebuild or otherwise reinstate the damaged improvement(s) in a manner and style different from the previously existing improvement, so long as the Leased Premises continue to be used for a public small boat harbor and marina, or such other use approved pursuant to paragraph 4.01, and the plans therefor are previously approved by Lessor if required under paragraph 4.03 of this Lease. In such event, the Lease shall continue in full force and effect. C. Lessee may remove the damaged improvement(s) in which event Lessee must also restore the Leased Premises to the condition specified in Article 11 of this Lease. In such event, the Lease shall continue in full force and effect. D. Lessee may elect to terminate the Lease by performing each of the following: 1. Giving written notice to Lessor of its intention to terminate, and ARRC Contract No. 9846 c9x1Page-9 2. Removing the damaged improvement(s) and restoring the Leased staid Premises to the condition specified in Article 11 of this Lease. ARTICLE 5 INSURANCE 5.01 Workers' Compensation. Lessee shall ensure that, with respect to all personnel performing work on the Leased Premises, Lessee maintains in effect at all times during the term of this Lease, coverage or insurance in accordance with the applicable laws relating to workers' compensation and employer's liability insurance, regardless of whether such coverage or insurance is mandatory or merely elective under the law. 5.02 Liability Insurance. During the entire Lease Term, and during any holdover thereafter, whether or not authorized by Lessor, Lessee shall keep in full force and effect a policy or policies of general liability insurance which includes bodily injury, property damage, and personal injury acceptable to Lessor with respect to the Leased Premises and the business operated by Lessee in which the limits for each shall be not less than Two Million Dollars ($2,000,000) per occurrence and Four Million Dollars ($4,000,000) aggregate or such higher limits as Lessor may specify from time to time consistent with prudent business practice then prevailing in the State of Alaska; provided, however, that no such limit shall in any way limit Lessee's liability or be construed as a representation of sufficiency to fully protect Lessee or Lessor. The policy or policies purchased pursuant to this paragraph shall name both Lessor and Lessee as insureds, with respect to the Leased Premises and the business operated by Lessee on the Leased Premises. 5.03 Policy Provisions. Insurance policy deductibles or retentions shall not exceed five percent (5%) of the policy limits without prior approval of Lessor. Each policy of comprehensive general liability insurance described in paragraph 5.02 of this Lease shall: A. Provide that the liability of the insurer thereunder shall not be affected by, and that the insurer shall not claim, any right of setoff, counterclaim, apportionment, proration, or contribution by reason of any other insurance obtained by or for Lessor, Lessee, or any person claiming by, through, or under any of them; B. Provide that such policy requires thirty (30) days notice to Lessor of any proposed cancellation, expiration, or change in material terms thereof and that such policy may not be canceled, whether or not requested by Lessee, unless the insurer first gives not less than thirty (30) days' prior written notice thereof to Lessor; and C. Contain a waiver by the insurer of any right of subrogation to proceed against Lessor or against any person claiming by, through, or under Lessor. ARRC Contract No. 9846 aD Page-10 5.04 Proof of Insurance. Lessee shall deliver to Lessor certificates of insurance on or before the effective date of this Lease or at such other date as agreed to in writing by Lessor. Additionally, Lessee shall deliver to Lessor photocopies of the policy or policies of insurance, certificates of insurance, or copies of endorsements as requested by the Lessor from time to time. ARTICLE 6 [RESERVED] ARTICLE 7 ASSIGNMENTS, MORTGAGES, SUBLEASES AND SUBDIVISION 7.01 Limitations on Assignment. Lessee shall not voluntarily or by operation of law assign, transfer, mortgage, sublet, or otherwise transfer or encumber all or any part of Lessee's interest in this Lease or in the Leased Premises, except in strict compliance with this Article 7. Any attempted assignment, transfer, mortgage, encumbrance or subletting without such compliance shall be void, and shall constitute a breach of this Lease. 7.02 Lessee's Right to Assign. Lessee shall have no right to assign or otherwise transfer Lessee's interest in this Lease and the estate created by this Lease without the written consent of the Lessor, which may be withheld in Lessor's sole discretion. 7.03 [RESERVED] 7.04 Right to Sublet. Lessee shall not sublet all or any part or parts of the Leased Premises but may authorize or permit individual users of the harbor facilities on the Leased Premises without approval by Lessor and without such uses being deemed subleases for purposes of this Lease. 7.05 Subdivision of Leased Premises. Lessee shall not, under any circumstances whatsoever, subdivide the Leased Premises or any part thereof. ARTICLE 8 ARBITRATION AND APPRAISAL PROCESS 8.01 Appointment of Arbitrators and Conduct of Arbitration. If Lessor and Lessee fail to agree upon the appraisal of a fee simple interest, the matter of disagreement, upon the election of either of them, shall be submitted to and determined by a single arbitrator, mutually appointed by them, whose decision and award shall be final, conclusive, and binding upon both of them. If Lessor and Lessee fail to mutually appoint a single arbitrator, the matter shall be submitted to and ARRC Contract No. 9846 �� Page-11 determined by three (3) arbitrators, in which event either Lessor or Lessee may give to the other written notice of election to have the matter of disagreement so arbitrated and shall appoint therein one of the arbitrators. The other party shall, within twenty (20) days after the receipt of such written notice, appoint a second arbitrator. If he fails to do so, the party who has already appointed an arbitrator may have the second arbitrator appointed by any judge of the Superior Court of Alaska resident in the district where the Leased Premises are situated. The two arbitrators so appointed in either manner shall appoint the third arbitrator, and if the first two arbitrators fail to appoint a third arbitrator within twenty (20) days after the appointment of the second arbitrator, either Lessor or Lessee may have the third arbitrator appointed by any judge of the Superior Court of Alaska resident in the district where the Leased Premises are situated. Each of the arbitrators appointed under this paragraph shall possess the professional qualifications provided in paragraph 8.02 hereof. The three arbitrators so appointed shall thereupon proceed to arbitrate the matter of disagreement, upon such rules of procedure as they may adopt, and shall render a written decision containing their findings and conclusions. The Lessor and Lessee shall share equally the costs associated with the arbitration. 8.02 Special Qualifications of Arbitrators. Each arbitrator appointed pursuant to paragraph 8.01 shall be a person who (1) has not less than five (5) years appraisal experience in the State of Alaska prior to appointment; (2) has appraised similar classes of property throughout the State of Alaska; and (3) is an Alaska State certified general appraiser and is an MAI member of the Nftird Appraisal Institute. 8.03 Judicial Review of Arbitration Decision. The decision of the arbitrator or arbitrators shall be final and unreviewable by any court, except to the extent authorized by Alaska Statutes 09.43.110, .120 and .130 as they exist now or may hereafter be amended. If the court determines that the arbitration decision should be set aside on one of the grounds enumerated in such statutes, it may proceed to decide the merits of the matter at the instance of either party to the Lease and neither party shall be required to submit to rearbitration of the matter. ARTICLE 9 DEFAULT AND DEFEASANCE 9.01 Events of Default. Each of the following events shall be a default by Lessee and breach of this Lease: A. Failure to Perform Lease Covenants. Lessee's abandonment or surrender of the Leased Premises or of the leasehold estate, or failure or refusal to pay when due any sum required by this Lease to be paid by Lessee, or to perform as required by any other covenant or condition of this Lease. ARRC Contract No. 9846 aL� Page-12 1 B. Appointment of Receiver. The appointment of a receiver or trustee to take possession of the Leased Premises or improvements or of the Lessee's interest in the leasehold estate or of Lessee's operations on the Leased Premises for any reason. C. Insolvency, Bankruptcy. An assignment by Lessee for the benefit of creditors or the filing of a voluntary or involuntary petition by or against Lessee under any provision of the U. S. Bankruptcy Code. 9.02 Notice and Right to Cure. A. Notices. As a precondition to pursuing any remedy for an alleged default by Lessee, Lessor shall, before pursuing any remedy, give notice of default to Lessee. Each notice of default shall state the alleged event of default and the intended remedy, but the identification of the intended remedy shall not limit Lessor's right to seek or use any other available remedy not identified in the notice. B. Method of Giving Notice. Lessor shall give notice of default in accordance with subparagraph 9.02.A of this Lease by personal delivery to each party required to receive it; or by (1) mailing by certified mail (return receipt requested) a copy of the notice to each party required to receive it at the last address provided by that party to Lessor and (2) mailing by first class mail a copy of the same notice to each such party at the same address. To be effective, personal delivery ` ,,, shall be documented by written acknowledgment of receipt by Lessee or by an affidavit of the personal delivery by Lessor's representative. C. Lessee's Right to Cure Defaults. 1. If the alleged default is nonpayment of taxes, or other sums to be paid by Lessee as provided in Articles 2 and 4 of this Lease or elsewhere in this Lease directed to be paid, Lessee shall have thirty(30) days after the notice is given to cure the default. 2. If, in the reasonable opinion of Lessor, the alleged default substantially endangers either the person or property of Lessor or a third party, or human health or the environment, Lessee shall commence curing the default immediately upon notice and complete the cure within such reasonable time period as is imposed by Lessor or any governmental body having jurisdiction in the matter. 3. For the cure of any other default, Lessee shall promptly and diligently after the notice commence curing the default and shall have sixty (60) days after notice is given to complete the cure. 9.03 Nonwaiver. Acceptance by Lessor or its agents of any amounts due under the terms of this Lease shall not be deemed to be a waiver by it of any breach by Lessee of any of its covenants contained in this Lease or of the right of Lessor to reenter the Leased Premises or to ARRC Contract No. 9846 Page-13 as_ declare a default for any such breach. Waiver by Lessor of any breach by Lessee shall not operate to extinguish the covenant the breach of which is so waived, nor be deemed to be a waiver of the right of Lessor to declare a default for any other breach thereof or of any other covenant. 9.04 Right of Lessor to Protect Against Default. Subject to paragraph 9.02.0 of this Lease, if Lessee fails to observe or perform any of its covenants contained herein, Lessor, at any time thereafter and without notice, shall have the right but not the obligation to observe or perform such covenant for the account and at the expense of Lessee, and shall not be liable to Lessee or anyone claiming by, through, or under it for any loss or damage by reason thereof to the occupancy, business, or property of any of them. All costs and expenses paid or incurred by Lessor in observing or performing such covenant shall be the responsibility of Lessee, which Lessee shall forthwith pay to Lessor upon statements therefor. 9.05 Lessor's Remedies. If any default by Lessee shall continue uncured, following notice of default as required by this Lease, for the period applicable to the default under paragraph 9.02 of this Lease, Lessor has the following remedies in addition to all other rights and remedies provided by law or equity or other provisions of this Lease, to which Lessor may resort cumulatively or in the alternative. The election of one remedy for any one default shall not foreclose an election of any other remedy for another default or for the same default at a later time. A. Termination. Lessor may, at Lessor's election, terminate this Lease by giving Lessee notice of termination in accordance with the procedures specified in paragraph 9.02.B of this Lease. On the giving of the notice of termination, all of Lessee's rights in the Leased Premises shall terminate. Promptly after notice of termination is given, Lessee shall remove all of Lessee's Improvements from the Leased Premises except for such of Lessee's Improvements that Lessor expressly and in writing allows Lessee to leave within the Leased Premises upon termination. Promptly after notice of termination, Lessee shall surrender and vacate the Leased Premises and all improvements not required to be removed in a clean condition, and Lessor may reenter and take possession of the Leased Premises and all remaining improvements and eject all parties in possession, or eject some and not others, or eject none, subject to applicable laws. If, upon receipt of Lessor's notice of termination, Lessee fails to remove within thirty (30) days any or all of Lessee's Improvements that have not been allowed by Lessor to remain on the Leased Premises, Lessor may proceed to treat said improvements as abandoned pursuant to paragraph 11.03 of this Lease. Termination under this paragraph shall not relieve Lessee, or any of its guarantors, insurers, or sureties, from the payment of any sum then due to Lessor or from any claim for damages previously accrued or then accruing against Lessee. B. Damages. Lessor shall also be entitled, at Lessor's election, to damages in the following sums: all administrative, marketing, brokerage, repair, cleaning and similar costs incurred by Lessor and necessary or useful to reletting the Leased Premises or placing it in good and marketable condition. ARRC Contract No. 9846 Page-14 g 9.06 Application of Sums Collected by Lessor. Lessor shall apply all proceeds of reletting as follows: first, to the payment of reasonable expenses (including attorneys' fees and brokers' commissions or both) paid or incurred by or on behalf of Lessor in recovering possession, placing the Leased Premises and improvements in good condition, and preparing or altering the Leased Premises or improvements for reletting; second, to the reasonable expense of securing new lessees; third, to the fulfillment of Lessee's covenants to the end of the Lease Term; and fourth, to Lessee's uses and purposes. ARTICLE 10 GENERAL PROVISIONS 10.01 Lessor's Right to Entry, Inspection and Repair. Lessor or its authorized agents may enter and inspect the Leased Premises at any time during regular business hours, with or without the presence of Lessee or its authorized representative, after giving twenty-four (24) hours' advance notice to Lessee of such inspection. Such inspections may include, but not be limited to, conducting tests for environmental contamination. All inspections will be conducted in a manner that does not unreasonably interfere with the operation of Lessee's business. If contamination is identified on the Leased Premises, Lessee shall be responsible for all resulting costs associated with cleanup as provided in paragraphs 4.05 and 4.10. In the event of an emergency, Lessor may enter and inspect the Leased Premises on reasonable notice (including no notice to Lessee if the ` ww circumstances warrant) and make such repairs or institute such measures, on the account and at the expense of Lessee, as may be necessary to avert or terminate the emergency. An emergency is any action, event, or condition, either extant or imminent, that threatens significant damage to property or the environment or injury to persons on or near the Leased Premises, and includes but is not limited to flood, fire, explosion, avalanche, earthquake, uncontrolled or dangerous discharge or release of water or other fluids or hazardous or toxic materials, unauthorized or illegal placement of hazardous or toxic materials on the Leased Premises, and shifting, settling or loss of earth or support on the Leased Premises. 10.02 Notices. Any notice, other than notice of default under subparagraphs 9.02.A and 9.02.6 of this Lease or notice of substantial endangerment under subparagraph 4.06, or demand to Lessor or Lessee provided for in this Lease may be given sufficiently for all purposes in writing, mailed by certified mail, return receipt requested, and addressed to such party or its agent at its mailing address specified herein or at the last such address specified by such party in writing to the other, or may be delivered personally within the State of Alaska to such party or its agent. Except as otherwise expressly provided herein, such notice shall be conclusively deemed to have been given three days after the date of such mailing or, if given by personal delivery, on the date of such delivery. If at any time during the Lease Term Lessee is more than one person or entity, any notice given by Lessor to any of them shall constitute notice to all of them, and any agreement or approval with or in favor of Lessor made or given by any of them shall bind all of them. ARRC Contract No. 9846 cR1 Page-15 10.03 Covenants and Conditions. Every provision in this Lease which imposes an obligation upon Lessee or invests an option, power, or right in Lessor shall be deemed to be a covenant of Lessee in favor of Lessor, and the time of observance and performance by Lessee of each such covenant shall be of the essence. Full and faithful observance and performance by Lessee of each of its covenants contained in this Lease shall be a condition hereof. Every provision in this Lease which imposes an obligation upon Lessor or invests an option, power, or right in Lessee shall be deemed to be a covenant of Lessor in favor of Lessee, and the time of observance and performance by Lessor of each such covenant shall be of the essence. Full and faithful observance and performance by Lessor of each of its covenants contained in this Lease shall be a condition hereof. 10.04 Integration and Amendments. Except as otherwise expressly provided in this Lease and except for the provisions of the Memorandum of Lease, this Lease is a complete integration of every agreement and representation made by or on behalf of Lessor and Lessee with respect to the Leased Premises, and no implied covenant or prior oral or written agreement shall be held to vary the provisions of this Lease, any law or custom to the contrary notwithstanding. In the event of any conflict between this Lease and the associated Memorandum of Lease, the provisions of the Memorandum of Lease shall control. No amendment or other modification of the provisions of this Lease shall be effective unless incorporated in a written instrument duly executed and acknowledged by Lessor and Lessee. 10.05 Approvals of Lessor. Except as otherwise expressly provided in this Lease and except for amendments or modifications of this Lease, Lessor shall neither unreasonably, capriciously, nor arbitrarily withhold any approval required to be obtained by Lessee hereunder, nor require any consideration therefor as a condition thereof other than payment forthwith by Lessee to Lessor of all costs and expenses paid or incurred by Lessor in connection with the review of the matter for which such approval is sought and the processing of such approval. 10.06 Survival and Severability. The rights and obligations of Lessor and Lessee provided in paragraphs 4.05 and 4.10 through 4.13 of this Lease, and in the Memorandum of Lease, except to the extent expressly varied or superseded by a subsequent instrument executed by Lessor and Lessee, shall survive the expiration or earlier termination of this Lease. If any provision of this Lease is held to be void or otherwise unenforceable by any court or other tribunal of competent jurisdiction, other than at the initiative or with the support of Lessor, within thirty (30) days after receipt of written notice of such holding Lessor shall have the right and option, exercisable by written notice thereof to Lessee, to terminate this Lease effective as of one year following the date of such written notice of exercise. It is understood and agreed that otherwise this Lease, except for such provision so held to be void or otherwise unenforceable, shall remain in full force and effect. 10.07 Binding Effect. This Lease shall be binding upon and shall inure to the benefit of Lessor and Lessee and their respective successors and assigns. The designations "Lessor" and "Lessee" include their respective successors and assigns and shall be so construed that the use of ARRC Contract No. 9846 Page-16 the singular number includes the plural number, and vice versa, and the use of any gender includes the other genders. If at any time during the Lease Term Lessee is more than one person or entity, including persons who are partners and operate Lessee as a partnership, their liability hereunder shall be joint and several. 10.08 Lessor's Authority to Convey Fee Title. Lessor retains the absolute and unconditional right to convey fee title in the Leased Premises, or an interest or estate therein, subject to this Lease and any contractual right relating to the Leased Premises created by Lessee in accordance with this Lease. 10.09 Powers of Lessor as Public Corporation. Nothing in this Lease restricts or limits the authority of Lessor, the Alaska Railroad Corporation, in the exercise of governmental authority delegated to it by the Alaska Railroad Corporation Act, AS 42.40, or by any other applicable law or regulation. 10.10 Captions. The captions of the articles and paragraphs hereof are for convenience only, are not an operative part hereof, and neither limit nor amplify in any way the provisions hereof. ARTICLE 11 DUTIES UPON TERMINATION OR EXPIRATION 11.01 Surrender of Leased Premises. Upon expiration or early termination of this Lease, Lessee shall surrender to Lessor the possession of the Leased Premises. Lessee shall leave the surrendered Leased Premises and any improvements in a clean condition, as noted in paragraph 11.02 of this Lease. If Lessee fails to surrender the Leased Premises at expiration or termination, Lessee shall defend and indemnify Lessor from all liability and expense resulting from the delay or failure to surrender, including but not limited to claims made by any succeeding tenant founded on or resulting from Lessee's failure to surrender. In the event of failure or refusal of Lessee to surrender possession of the Leased Premises, Lessor shall have the right to reenter the Leased Premises and remove therefrom Lessee or any person, firm or corporation claiming by, through or under Lessee and to obtain damages for trespass from Lessee. 11.02 Removal of Improvements Upon Termination. A. Upon the expiration or termination of this Lease, including termination resulting from Lessee's breach ("termination"), Lessee shall leave the Leased Premises in a clean and leasable condition, which shall include removal of all improvements, personal property, trash, boats or vessels, vehicles, and equipment, except as noted in subparagraphs 11.02.B, 11.02.0 and 11.02.D of this Lease. Any excavation on the property, including excavation to remove Lessee's Improvements, shall be filled and compacted with material approved by Lessor and in accordance with applicable laws. ARRC Contract No. 9846 C) Page-17 B. Lessor may, at its option, allow Lessee to leave some or all of Lessee's Improvements on the Leased Premises upon termination. If Lessor so elects, such improvements shall become the property of Lessor upon termination. C. Lessor may, at its option, require Lessee to leave some or all of Lessee's Improvements on the Leased Premises upon termination, with Lessor becoming the owner of such improvements, when, at the time of termination, Lessee has failed to make all payments to Lessor required under this Lease. D. Any improvements owned by Lessor and identified in paragraph 1.03 of this Lease, or added to the Leased Premises by Lessor after execution of this Lease, shall not be removed by Lessee. 11.03 Abandonment of Lessee's Property. All Lessee Improvements that Lessee is not allowed to leave on the Leased Premises shall, thirty (30) days following termination of this Lease, be conclusively deemed abandoned by Lessee unless Lessee is prevented from removing such property due to weather conditions or other force majeure, in which event the effect of this paragraph shall be suspended but only to the extent made necessary by the force majeure. Abandoned property shall, at the election of Lessor, become the property of Lessor or be destroyed or removed by Lessor and Lessee shall be responsible to reimburse Lessor's reasonable destruction and/or removal costs therefor. 11.04 Liability for Cleanup Expenses. Lessee shall be liable for all costs and expenses incurred by Lessor to remove or destroy abandoned property and improvements not required or expressly allowed by Lessor in writing to be left on the Leased Premises, and for the removal of trash or other debris left thereon. In addition, nothing in this Lease shall relieve Lessee of any obligation or liability for removal of hazardous substances (including wastes) or inappropriate fill material placed on the Leased Premises during the term of the Lease, regardless of when such hazardous substance (including waste) or inappropriate fill material is discovered. ARTICLE 12 EXECUTION AND MEMORANDUM OF LEASE 12.01 Execution and Counterparts. This Lease is executed in two or more counterparts, each of which shall be an original, and all of which shall constitute one and the same instrument. ARRC Contract No. 9846 Page-18 12.02 Recordation of Memorandum of Lease. This Lease shall not be recorded. The parties shall execute in suitable form for recordation a memorandum of this Lease ("Memorandum of Lease"), which shall be recorded. The Memorandum of Lease shall be the Lessor's standard form Memorandum of Lease. IN WITNESS WHEREOF, Lessor and Lessee have duly executed and acknowledged this Lease. LESSOR ALASKA RAILROAD CORPORATION Dated: By: William O'Leary President and Chief Executive Officer Dated: By: James W. Kubitz Vice President, Corporate Planning & Real Estate LESSEE CITY OF SEWARD Dated: By: Jim Hunt City Manager ATTEST: (City Seal) Johanna Kinney, MMC City Clerk ARRC Contract No. 9846 Page-19 STATE OF ALASKA ) )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by William O'Leary, President and Chief Executive Officer of the Alaska Railroad Corporation, a public corporation created by Alaska Statute 42.40, on behalf of the corporation. Notary Public in and for Alaska My Commission expires: STATE OF ALASKA ) )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by James. W. Kubitz, Vice President, Corporate Planning & Real Estate of the Alaska Railroad Corporation, a public corporation created by Alaska Statute 42.40, on behalf of the corporation. Notary Public in and for Alaska My Commission expires: STATE OF ALASKA ) )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by Jim Hunt, City Manager, City of Seward, a municipal corporation, on behalf of the municipal corporation. Notary Public in and for Alaska My Commission expires: ARRC Contract No. 9846 2O Page-20 City of Seward ARRC Contract No. 9846 SCHEDULE 1 A parcel of land consisting of uplands, tidelands and submerged lands located within the Alaska Railroad Seward Terminal Reserve in Section 3, Township 1 South, Range 1 West, Seward Meridian Alaska, situated in the Seward Recording District, Third Judicial District, State of Alaska and further described as follows: Commencing at WCC 1 , U.S. Survey No. 149 as shown on Plat No. 90 Seward Industry Park, Seward Recording District, Seward, Alaska; thence South 25.24 feet to a point on the southerly right-of- way line of Port Avenue and common with the northwest corner of Parcel 1A, Hyundai Merchant Marine leasehold, ARRC Contract No. 8692; thence S 00° 00' 00" W (due south) along the west boundary of U.S. Survey 149 (ARRC Seward Reserve), a distance of 750.97 feet to the southwest corner of Hyundai Merchant Marine leasehold, ARRC Contract No. 8692 and the True Point of Beginning: Thence N 86° 14' 11" E along the south lease line of Hyundai Merchant Marine leasehold, ARRC Contract No. 8692, a distance of 47.40 feet; thence S 03° 17' 14" E, a distance of 1075.76 feet; thence S 87° 23' 42" W, a distance of 42.40 feet; thence N 64° 16' 34"W, a distance of 73.96 feet; thence N 00° 00' 00" E (due north) along the west boundary of the ARRC Seward Terminal Reserve, a distance of 1040.70 feet to the True Point of Beginning. The above-described property contains 82,951 square feet, more or less, as shown on the attached drawing. In the event of any inconsistency between the attached drawing and the foregoing legal description, the latter shall govern for purposes of this Lease. Z3 Schedule No. 2 Lease Contract No. 9846 SCHEDULE 2 LEGAL DESCRIPTION OF LAND TO BE CONVEYED IN FEE SIMPLE FROM THE CITY OF SEWARD TO THE ALASKA RAILROAD CORPORATION IN EXCHANGE FOR ISSUANCE OF ARRC GROUND LEASE CONTRACT NO. 9846 AND RENT-FREE EXTENSION OF ARRC GROUND LEASE CONTRACT NO. 8560 Two parcels of land located within the Seward Recording District, Third Judicial District, State of Alaska and described as follows, subject to all existing easements and on condition that use and development of the Property shall be in compliance with the Seward City Code of Ordinances: Lots 1 and 2, Block 6, SEWARD SMALL BOAT HARBOR SUBDIVISION, according to Plat Number 2000-19, Records of the Seward Recording District, Third Judicial District, State of Alaska, as shown on the drawing attached hereto as Schedule 2, Exhibit A, containing 17,891 square feet, more or less, and incorporated herein. In the event of any inconsistency between the attached drawing and the foregoing legal description, the latter shall govern for purposes of this Schedule 2. [Legal description and drawings subject to correction and final verification.] RECORDERS OFFICE RETURN TO: ALASKA RAILROAD CORPORATION ATTN: REAL ESTATE P.O. BOX 107500 ANCHORAGE, AK 99510-7500 STATE BUSINESS: NO CHARGE City of Seward Lease Contract No. 9846 MEMORANDUM OF LEASE PLEASE TAKE NOTICE that the ALASKA RAILROAD CORPORATION (herein called "Lessor"), a public corporation created pursuant to AS 42.40, whose mailing address is P.O. Box 107500, Anchorage, Alaska 99510-7500, and the CITY OF SEWARD (herein called "Lessee"), a home rule city, whose mailing address is P.O. Box 167, Seward, Alaska, 99664, have entered into a lease (herein called "the Lease") dated . The Lease affects that property known as: A parcel of uplands, tidelands and submerged lands located within the Alaska Railroad Seward Reserve situated in the Seward Recording District, Third Judicial District, State of Alaska and more specifically described on Schedule 1 attached to and for all purposes made a part of this Memorandum of Lease. The term of the Lease is ninety-five (95) years commencing as of , 2014, Stow and ending on , 2109. There is no right provided in the lease to extend or renew the Lease or right to purchase the real property subject to the Lease. The complete terms and conditions of the lease agreement are contained in documents that are in the possession of the parties at the above addresses. IN WITNESS WHEREOF, Lessor and Lessee have duly executed and acknowledged this Memorandum of Lease. LESSOR ALASKA RAILROAD CORPORATION Dated: By: James W. Kubitz Vice President, Corporate Planning & Real Estate Memorandum of Lease to N2S- Page-l ARRC Contract No. 9846 LESSEE CITY OF SEWARD Dated: By: Jim Hunt City Manager ATTEST: (City Seal) City Clerk STATE OF ALASKA )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by James. W. Kubitz, Vice President, Corporate Planning & Real Estate of the Alaska Railroad Corporation, a public corporation created by Alaska Statute 42.40, on behalf of the corporation. Notary Public in and for Alaska My Commission expires: STATE OF ALASKA )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by Jim Hunt, City Manager, City of Seward, a municipal corporation, on behalf of the municipal corporation. Notary Public in and for Alaska Nod My Commission expires: Memorandum of Lease to Page-2 ARRC Contract No. 9846 City of Seward ARRC Contract No. 9846 SCHEDULE 1 A parcel of land consisting of uplands, tidelands and submerged lands located within the Alaska Railroad Seward Terminal Reserve in Section 3, Township 1 South, Range 1 West, Seward Meridian Alaska, situated in the Seward Recording District, Third Judicial District, State of Alaska and further described as follows: Commencing at WCC 1, U.S. Survey No. 149 as shown on Plat No. 90 Seward Industry Park, Seward Recording District, Seward, Alaska; thence South 25.24 feet to a point on the southerly right-of- way line of Port Avenue and common with the northwest corner of Parcel 1A, Hyundai Merchant Marine leasehold, ARRC Contract No. 8692; thence S 00° 00' 00" W (due south) along the west boundary of U.S. Survey 149 (ARRC Seward Reserve), a distance of 750.97 feet to the southwest corner of Hyundai Merchant Marine leasehold, ARRC Contract No. 8692 and the True Point of Beginning: Thence N 86° 14' 11" E along the south lease line of Hyundai Merchant Marine leasehold, ARRC Contract No. 8692, a distance of 47.40 feet; thence S 03° 17' 14" E, a distance of 1075.76 feet; thence S 87° 23' 42" W, a distance of 42.40 feet; thence N 64° 16' 34"W, a distance of 73.96 feet; thence N 00°00' 00" E (due north) along the west boundary of the ARRC Seward Terminal Reserve, a distance of 1040.70 feet to the True Point of Beginning. The above-described property contains 82,951 square feet, more or less, as shown on the attached drawing. In the event of any inconsistency between the attached drawing and the foregoing legal description, the latter shall govern for purposes of this Lease. RECORDERS OFFICE RETURN TO: ALASKA RAILROAD CORPORATION ATTN: REAL ESTATE P.O. BOX 107500 ANCHORAGE, AK 99510-7500 STATE BUSINESS— NO CHARGE Memorandum of Lease to Page-3 ARRC Contract No.9846 Supplement No. 1 to ARRC Contract No. 8560 SUPPLEMENT THIS SUPPLEMENT is made on the day executed by the last signatory hereto, by and between the ALASKA RAILROAD CORPORATION, a public corporation created pursuant to AS 42.40("Lessor"),whose mailing address is P.O. Box 107500,Anchorage,Alaska 99510-7500, and the CITY OF SEWARD, a municipal corporation located in the Kenai Peninsula Borough, State of Alaska("Lessee" or"the City"), whose mailing address is P.O. Box 167, Seward, Alaska 99664. RECITALS A. Lessor is the lessor of real property located in the Seward Recording District, Third Judicial District,State of Alaska(the"Leased Premises")under that certain lease,ARRC Contract No.8560, effective April 10, 2003 (the "Lease"), which was recorded January 24, 2014, at Document No. 2014-000065-0 in the records of said recording district. The Leased Premises are more particularly described in Article 1 of the Lease. B. The City is the lessee under the Lease. C. The Leased Premises comprises two parcels located within the City of Seward which are denominated at Parcel 1 and Parcel 2 under the Lease. Parcels 1 and 2 are designated for use as a fish cleaning site and an oil recycling center, respectively, along with such other activities as are reasonably related to those uses. D. The Lease constituted one side of an exchange of reciprocal leases between Lessor and Lessee. The reciprocal leases provided that the exchange of leases acted as consideration for each lease. Although each of the reciprocal leases set forth rent provisions, each provided that rent payments would not be due so long as both leases remained in full force and effect and neither lease was in default. E. The reciprocal lease from the City to ARRC described in Recital D pertains to a parcel of land located within Lot 1, Block 6, Seward Small Boat Harbor Subdivision and consisting of approximately 3,537 square feet("Lot 1 A"). The conveyance by the City of fee simple title in Lot 1 A,subject to existing easements,on condition that use and development of the Property shall be in compliance with the Seward City Code of Ordinances,is part of the consideration for the rent-free extension of the Lease, as described in detail in Recital G. Supplement No.1 to Contract No.8560 Page 1 slow, F. Lessor also leases to the City under a separate ground lease, ARRC Contract No. 8670 (the "Breakwater Lease"),uplands,tidelands and submerged lands in the vicinity of the breakwater lying between the Seward Small Boat Harbor and the Seward Coal Loading Facility. The Breakwater Lease runs through October 31, 2058, and provides for the payment of rent by the City. G. Lessor and Lessee have now mutually agreed that the Lease and the Breakwater Lease will be extended, the former for a period of up to thirty-five (35)years from the present with an option to extend the lease an additional period not to exceed thirty-five(35)years upon mutual agreement of Lessor and Lessee; and the latter for a term of ninety-five(95) years from the present, with neither lease requiring payment of rent. As consideration for the rent-free extension of the Lease and the Breakwater Lease,Lessee has agreed to convey to Lessor fee simple title to two parcels of uplands in the vicinity of the Seward Small Boat Harbor as more particularly described in Schedule 1 attached to and for all purposes made a part of this Supplement and the Lease. The parties acknowledge and agree that said conveyances constitute full and fair consideration for the rent-free extensions of the Lease and Breakwater Lease described herein. H. The term of the Lease currently expires on April 9,2038. The parties agree and intend by this Supplement to (i)extend the term of the Lease to and including April 9,2048, for continued use of the Leased Premises as a fish cleaning site and oil recycling center;and(ii)remove the requirement that Lessee pay rent under the Lease. The extension and elimination of rent provisions described in this Recital H will be subject to the terms and conditions set forth in this Supplement,including the rights to terminate the Lease with respect to Parcels 1 and 2 set forth in paragraph 2.2 of the Lease as , added by paragraph 2 of this Supplement. These rights to terminate the Lease in whole or in part during the Extended Term are necessary to accommodate potential future development of the Leased Premises if and when they are no longer used for the purposes allowed under the Lease. I. The parties now wish to amend the Lease to(i)extend the term of the Lease as described in Recital H; (ii) eliminate the requirement that Lessee pay rent under the Lease provided that Lessee conveys to Lessor fee simple title to the property described in Schedule 1; and (iii) provide for termination of the Lease by Lessor as noted in Recital H and set forth in paragraph 2.2 of the Lease as added by paragraph 2 of this Supplement. Supplement No.1 to Contract No.8560 Page 2 AGREEMENT NOW, THEREFORE, in consideration of the foregoing and other good and valuable consideration, the parties agree that the Lease is hereby amended as follows: 1. Schedule 1 attached hereto is hereby and for all purposes made a part of this Lease. 2. Article 2 of the Lease is hereby deleted in its entirety and the following shall be inserted in place thereof: ARTICLE 2 —LEASE TERM 2.1 Lease Term. The term of this Lease(the"Lease Term") shall commence on April 10, 2003 (the "Effective Date"). The Lease Term shall run for approximately 45 years from the Effective Date,ending at midnight on April 9, 2048, with an option to extend. 2.2 Termination for Change in Use. Unless a change of use with respect to Parcel 1 is previously approved in writing pursuant to paragraph 4.1 of this Lease,Lessor reserves the right,to be exercised at its discretion,to terminate this Lease at any time with respect to Parcel 1 if Lessee is no longer using Parcel 1 as a fish cleaning site as required by paragraph 4.1. Unless a change of use with respect to Parcel 2 is previously approved in writing by Lessor pursuant to paragraph 4.1 of this Lease, Lessor reserves the right, to be exercised at its discretion,to terminate this Lease at any time with respect to Parcel 2 if Lessee is no longer using Parcel 2 as an oil recycling center as required by paragraph 4.1. 3. Article 3 of the Lease is hereby deleted in its entirety and the following shall be inserted in place thereof: ARTICLE 3 —CONSIDERATION Upon entering into this Lease, Lessee is simultaneously conveying to Lessor fee simple interest in the two parcels of uplands in the vicinity of the Seward Small Boat Harbor as more particularly described in Schedule 1 to this Lease. Lessor and Lessee hereby agree that said conveyance of land, once complete and irrevocable, shall satisfy in full any and all rents which are or may become due during the term of this Lease. Lessor and Lessee further agree that said conveyance of land constitutes full and fair consideration under this Lease for its full term, including any extension thereof. EXCEPT AS AMENDED by the foregoing, the Lease as it may have been previously amended shall continue in full force and effect. Supplement No.1 to Contract No.8560 Page 3 Skov IN WITNESS WHEREOF,the parties hereto have executed this Supplement as of the dates set out below. ALASKA RAILROAD CORPORATION Dated: By: James W. Kubitz Vice President,Corporate Planning&Real Estate CITY OF SEWARD Dated: By: Jim Hunt City Manager ATTEST: Johanna Kinney, MMC City Clerk [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] Supplement No.1 to Contract No.8560 Page 4 STATE OF ALASKA ) ) ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014,by James W.Kubitz,Vice President,Corporate Planning&Real Estate of the Alaska Railroad Corporation, a public corporation created pursuant to Alaska Statute 42.40, on behalf of the corporation. Notary Public in and for Alaska My Commission expires: STATE OF ALASKA ) )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2014, by Jim Hunt, the City Manager of the City of Seward, a municipal corporation, on behalf of the municipal corporation. Notary Public in and for My Commission expires: Supplement No.1 to Contract No.8560 Page 5 Schedule No. 1 Lease Contract No. 8560, Supplement No. 1 SCHEDULE 1 LEGAL DESCRIPTION OF LAND TO BE CONVEYED IN FEE SIMPLE FROM THE CITY OF SEWARD TO THE ALASKA RAILROAD CORPORATION IN EXCHANGE FOR EXTENSION AND CONVERSION TO RENT-FREE STATUS OF ARRC GROUND LEASE CONTRACT NO. 8560 AND ISSUANCE OF ARRC GROUND LEASE CONTRACT NO. 9846, WHICH EFFECTIVELY EXTENDS AND CONVERTS TO RENT-FREE STATUS ARRC GROUND LEASE CONTRACT NO. 8670 Two parcels of land located within the Seward Recording District, Third Judicial District, State of Alaska and described as follows, subject to existing easements, on condition that use and development of the Property shall be in compliance with the Seward City Code of Ordinances: Lots 1 and 2, Block 6, SEWARD SMALL BOAT HARBOR SUBDIVISION, according to Plat Number 2000-19,Records of the Seward Recording District,Third Judicial District, State of Alaska, as shown on the drawing attached hereto as Schedule 1,Exhibit A,containing 17,891 square feet,more or less,and incorporated herein. The parties specifically recognize that existing utilities on these lots may not be recorded in existing plats and agree to cooperate to re-locate any such utilities as necessary for future development into the existing recorded easements. In the event of any inconsistency between the attached drawing and the foregoing legal description, the latter shall govern for purposes of this Schedule 1. [Note: Legal description and drawing subject to correction and final verification.] RECORDERS OFFICE RETURN TO: ALASKA RAILROAD CORPORATION ATTN: REAL ESTATE P.O. BOX 107500 ANCHORAGE,AK 99510-7500 STATE BUSINESS: NO CHARGE Supplement No.1 to Contract No.8560 Page 6 QUITCLAIM DEED The Grantor, CITY OF SEWARD, a municipal corporation located in the Kenai Peninsula Borough, State of Alaska, whose address is P.O. Box 167, Seward, Alaska, 99664, for and in consideration of the sum of Ten Dollars ($10.00) and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, hereby conveys, releases, and quitclaims to the Grantee, ALASKA RAILROAD CORPORATION, whose address is P.O. Box 107500, Anchorage, Alaska 99510-7500, all of Grantor's right, title, and interest in that certain real property situated in the Seward Recording District, Third Judicial District, State of Alaska, more fully described as follows: Lots 1 and 2, Block 6, SEWARD SMALL BOAT HARBOR SUBDIVISION, according to Plat Number 2000-19, Records of the Seward Recording District, Third Judicial District, State of Alaska Together with any and all of the easements and appurtenances thereto, and improvements located thereon; and subject to any and all easements, restrictions, covenants, and encumbrances of record. This Quitclaim Deed is made, and the above-referenced real property conveyed to Grantee, on the condition that use and development of that portion of said real property located in Lots 1 and 2, Block 6, Seward Small Boat Harbor Subdivision shall be in compliance with the Seward City Code of Ordinances applicable to said lot. CITY OF SEWARD, ALASKA Dated By: Jim Hunt City Manager Nad STATE OF ALASKA ) THIRD JUDICIAL DISTRICT ) ss. The foregoing instrument was acknowledged before me this day of 2014, by Jim Hunt, the City Manager of the City of Seward, Alaska, a municipal corporation, on behalf of the same. Notary Public in and for Alaska My Commission Expires RECORDER'S OFFICE RETURN TO: ALASKA RAILROAD CORPORATION ATTN: REAL ESTATE P.O. BOX 107500 ANCHORAGE, AK 99510-7500 STATE BUSINESS — NO CHARGE Sponsored by: Hunt CITY OF SEWARD, ALASKA RESOLUTION 2014-087 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,APPROVING THE CITY OF SEWARD'S CALENDAR YEAR 2015 CITY LEGISLATIVE PRIORITIES WHEREAS, the city annually compiles a list of projects or issues that are identified as top legislative priorities; and WHEREAS, this resolution validates projects, prioritizes needs, and focuses the efforts of City Administration in its lobbying efforts; and WHEREAS, the list of projects are compiled and distributed to the State of Alaska Legislature, Kenai Peninsula Borough, and City of Seward lobbyist; and WHEREAS, the passage of this resolution occurs through a public process; and WHEREAS, all projects on this list are consistent with the City Comprehensive and Strategic Plans. Neftid NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA, that: Section 1. This list of city projects is hereby declared to be the official city priority list for the City of Seward for calendar year 2015. A. CAPITAL PROJECTS (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2) The expense to be determined for doubling the vessel transport capacity of the ship lift (Syncrolift) and associated upland improvements at the Seward Marine Industrial Center Dry Dock in conjunction with Vigor Marine to meet current and increasing customer demands. The current,rail-only infrastructure is inadequate. (3) $150,000 for a 8-ton crane at or near the travel-lift dock. (4) $500,000 to add a wash down pad at the 50 ton travel lift. (5) $2 million for expanding the Providence Seward Hospital Medical Clinic, moving the CT scanner into the facility, increasing backup generator capacity, and improving space for primary health care (City provides $500 thousand annually for hospital financing of capital improvements). (6) $8 million to design and rebuild the transmission line from the Seward Highway to Seward Marine Industrial Center and upgrade the Spring Creek substation by securing an alternative feed transformer to reduce system outages. Nod CITY OF SEWARD, ALASKA RESOLUTION 2014-087 (7) $1.5 million to repair and replace one mile of transmission line into the Fort Raymond Substation with 115kV compatible equipment (this is a project supported by the Alaska Railbelt Cooperative Transmission and Electric Company - ARCTEC - because the current condition of the transmission line exceeds the estimated life expectancy of 50-years). (8) $2.25 million for Seward Community Roads for paving, repaving road surfaces and improve roadway drainage systems. (9) $250K for initial design and engineering of a new Fire Station. (10)$900K for a new animal shelter that is used by City and Borough citizens. B. BENEFICIAL LEGISLATION (1) Feasibility study for providing liquid natural gas to the Seward Region that includes Road/Rail/Barge options. Section 2. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27th day of October, 2014. THE CITY OF SEWARD, ALASKA Jean Bardarson, Mayor AYES: NOES: ABSENT: ABSTAIN: VACANT: ATTEST: Johanna Kinney City Clerk, CMC (City Seal) LA-1 *SUBSTITUTE Noid Sponsored by: Hunt CITY OF SEWARD, ALASKA SUBSTITUTE RESOLUTION 2014-087 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,APPROVING THE CITY OF SEWARD'S CALENDAR YEAR 2015 CITY LEGISLATIVE PRIORITIES WHEREAS, the City annually compiles a list of projects or issues that are identified as top legislative priorities; and WHEREAS, this resolution validates projects, prioritizes needs, and focuses the efforts of City Administration in its lobbying efforts; and WHEREAS, the list of projects are compiled and distributed to the State of Alaska Legislature, Kenai Peninsula Borough, and City of Seward lobbyist; and WHEREAS,the passage of this resolution occurs through a public process; and WHEREAS, all projects on this list are consistent with the City Comprehensive and , Strategic Plans. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA,that: Section 1. This list of city projects is hereby declared to be the official city priority list for the City of Seward for calendar year 2015. A. PORT, HARBOR,AND INDUSTRIAL AREA (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2) For an amount to be determined: Infrastructure to provide doubling the vessel transport capacity of the ship lift (Syncrolift) and associated upland improvements at Vigor's Seward Dry Dock to meet current and increasing customer demands. The current, rail- only infrastructure is inadequate. (3) $200,000 for engineering and design to replace failing infrastructure in the Seward Small Boat Harbor including A, B, C, G, K, L, and S Floats. (4) $150,000 8-ton crane at or near the travel-lift dock. (5) $500,000 to pave the apron and add a wash down pad at the 50 ton travel lift. B. PUBLIC FACILITIES & INFRASTRUCTURE (1) $475K For maintenance and repair of City Hall Safety Center (Houses Courthouse, City administration, DMV, and Wildlife Trooper offices) y/ *SUBSTITUTE Stir CITY OF SEWARD,ALASKA RESOLUTION 2014-087 (2) $3.2 million to construct a bypass lagoon and to dredge and dispose of sludge in the sewage lagoon serving the State Department of Corrections Spring Creek facility. (3) $250K for initial design and engineering of a new 100' x 80' metal building to replace and relocate our existing public works shop (City will provide land for the new building). (4) $2 million for expanding the Providence Seward Hospital Medical Clinic, moving the CT scanner into the facility, increasing backup generator capacity, and improving space for primary health care (City provides $500 thousand annually for hospital financing of capital improvements). (5) $450,000 for Alaska SeaLife Center veterinary and emergency spill response equipment. (6) $2 million to replace a failing roof at the Alaska SeaLife Center. C. ELECTRIC (1) $5 million to design and rebuild the transmission line from the Seward Highway to Seward Marine Industrial Center. (2) $1 million to take advantage of an existing out-of-use water main in order to bury and secure utility lines running next to the lagoon. (3) $1.5 million to repair and replace one mile of transmission line into the Fort Raymond Substation with 115kV compatible equipment (this is a project supported by the Alaska Railbelt Cooperative Transmission and Electric Company — ARCTEC — because the current condition of the transmission line exceeds the estimated life expectancy of 50- years). (4) $3 million to upgrade the Spring Creek substation in the Seward Marine Industrial Center by securing an alternative feed transformer to reduce system outages. (5) $2 million to rebuild obsolete and aging infrastructure and add new infrastructure within the expanding Camelot Subdivision where development is and growth requires the new updated system. D. ROADS,STREETS,AND ADA ACCESIBILITY (1) $2.25 million for Seward Community Roads for paving, repaving road surfaces and improve roadway drainage systems. (2) $300,000 for improving City ADA accessibility. (3) $2.496 million for design, engineering and construction to protect Lowell Point Easement road from further coastal erosion. This access "road" is the sole land-access to critical public infrastructure, Kenai National Park, and a Kenai Peninsula Borough residential housing area. E. PUBLIC SAFETY (1) $6 million for a replacement Seward Fire Station. The City is experiencing growth on the west side (Fuel farm expansion and homes) and in the industrial area at the Marine Center. (City will provide a match of land). (2) $250K for initial design and engineering of a Public Safety Building (City will provide a .. match of land). 1Ci *SUBSTITUTE CITY OF SEWARD,ALASKA RESOLUTION 2014-087 (3) $900K for a new animal shelter that is used by City and Borough citizens. Section 2. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27th day of October, 2014. THE CITY OF SEWARD,ALASKA Jean Bardarson,Mayor AYES: NOES: ABSENT: ABSTAIN: VACANT: ATTEST: Johanna Kinney City Clerk, CMC (City Seal) EO Council Agenda Statement e{of gF� %►-� 9p g Date: October 27, 2014 . _ o Meeting From: Jim Hunt, City Manager q P to� Agenda Item: Calendar Year 2015 City, State and Federal Priorities BACKGROUND &JUSTIFICATION: The City annually compiles a list of projects or issues that we identify as our top City, State and Federal legislative priorities. The list of projects is compiled into a package that is distributed to the Governor's Office, our legislators, the Kenai,,P.erlinsula Borough (for inclusion in their legislative package), and our lobbyist. The list validates projects and greatly focuses the efforts of the Administration in our lobbying effort as we seek funding or other,resolutions both through the State of Alaska and Federal sources. This year the three lists include projects that are in the planning phase and/or may qualify for grants in addition to some projects with which Council.,is f miliar. In order to quality for most grants, the City must include these projects on the City priority list. This year Council is being presented with two sets of City and State priorities, either can be amended. Following the Council work session on September 29th administration compiled a traditional version of the priorities using that extensive direction; however it has been recommended that the City clearly identify priorities taking the State's economic climate into consideration, resulting in a shorter and more concise list for Council consideration. INTENT: This list of priorities focuses the efforts of Administration in lobbying efforts to obtain appropriations, grants, and legislation from the State and Federal sources to improve the City of Seward. To qualify for most appropriations and grants Seward's City, State and Federal priorities lists must be approved in a public process by the City Council. CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan: Sections 1.3 Economic Development X 2. Strategic Plan (document source here): Entirety X 3. Other (list): X ATTORNEY REVIEW: Yes No X FISCAL NOTE: NA RECOMMENDATION: "'Council approve Resolutions 2014-087, 2014-088, and 2014-089, approving the City of Seward's Calendar Year 2015 City, State and Federal Priorities. FROM: Port and Commerce Advisory Board TO: City Council RE: 2015 Legislative Priorities On October 1,2014 the Port and Commerce Advisory Board reviewed legislative priorities for 2015, compiling and agreeing by vote upon the following list. PORT, HARBOR, AND INDUSTRIAL AREA (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2)The expense to be determined for doubling the vessel capacity of the ship lift(Syncrolift) and associated upland improvements at Vigor's Seward Dry Dock to meet current and increasing customer demand. The current rail-only infrastructure is inadequate. (3) $200,000 for engineering and design to replace failing infrastructure in the Seward Small Boat Harbor including A, B, C, G, K, L, and S Floats. (4) $150,000 for an 8-ton crane at (or near) the travel-lift dock. (5) $500,000 to pave the apron and add a wash down pad at the 50 ton travel lift. (6) $250,000 to complete paving and drainage improvements in the northeast parking lot of the Seward Small Boat Harbor. EON Sponsored by: Hunt CITY OF SEWARD,ALASKA RESOLUTION 2014-088 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ESTABLISHING THE CITY OF SEWARD'S CALENDAR YEAR 2015 STATE LEGISLATIVE PRIORITIES WHEREAS, the City annually compiles a list of projects or issues that are identified as top state legislative priorities; and WHEREAS, this resolution validates projects, prioritizes needs, and focuses the efforts of City Administration in its lobbying efforts; and WHEREAS, the list of projects are compiled and distributed to the State of Alaska Legislature, Kenai Peninsula Borough, and City of Seward lobbyist; and WHEREAS, the passage of this resolution occurs through a public process; and WHEREAS, all projects on this list are consistent with the City Comprehensive and Strategic Plans. Sor NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA, that: Section 1. The following list of legislative projects is hereby declared to be the official legislative priority list of the City of Seward for the 2015 State of Alaska legislative session: A. CAPITAL PROJECTS (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2) The expense to be determined for doubling the vessel transport capacity of the ship lift (Syncrolift) and associated upland improvements at the Seward Marine Industrial Center Dry Dock in conjunction with Vigor Marine to meet current and increasing customer demands. The current, rail-only infrastructure is inadequate. (3) $150,000 for a 8-ton crane at or near the travel-lift dock (4) $500,000 to add a wash down pad at the 50 ton travel lift (5) $2 million for expanding the Providence Seward Hospital Medical Clinic, moving the CT scanner into the facility, increasing backup generator capacity, and improving space for primary health care (City provides $500 thousand annually for hospital financing of capital improvements). (6) $8 million to design and rebuild the transmission line from the Seward Highway to Seward Marine Industrial Center and upgrade the Spring Creek substation by securing an alternative feed transformer to reduce system outages. �3 CITY OF SEWARD, ALASKA RESOLUTION 2014-088 solid (7) $1.5 million to repair and replace one mile of transmission line into the Fort Raymond Substation with 115kV compatible equipment (this is a project supported by the Alaska Railbelt Cooperative Transmission and Electric Company — ARCTEC — because the current condition of the transmission line exceeds the estimated life expectancy of 50- years). (8) $2.25 million for Seward Community Roads for paving, repaving road surfaces and improve roadway drainage systems. (9) $250K for initial design and engineering of a new Fire Station. (10) $900K for a new animal shelter that is used by City and Borough citizens. B. BENEFICIAL LEGISLATION (1) Feasibility study for providing liquid natural gas to the Seward Region that includes Road/Rail/Barge options. Section 2. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27th day of October, 2014. THE CITY OF SEWARD, ALASKA Jean Bardarson, Mayor AYES: NOES: ABSENT: ABSTAIN: VACANT: ATTEST: Johanna Kinney City Clerk, CMC (City Seal) Nord *SUBSTITUTE Sponsored by: Hunt CITY OF SEWARD,ALASKA SUBSTITUTE RESOLUTION 2014-088 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ESTABLISHING THE CITY OF SEWARD'S CALENDAR YEAR 2015 STATE LEGISLATIVE PRIORITIES WHEREAS, the City annually compiles a list of projects or issues that are identified as top state legislative priorities; and WHEREAS, this resolution validates projects, prioritizes needs, and focuses the efforts of City Administration in its lobbying efforts; and WHEREAS, the list a. are compiled and distributed to the State of Alaska Legislature, Kenai Peninsula Borough, and City of Seward lobbyist; and WHEREAS,the passage of this resolution occurs through a public process; and r WHEREAS, all projects on this list are consistent with the City Comprehensive and Strategic Plans. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA,that: Section 1. The following list of legislative projects is hereby declared to be the official legislative priority list of the City of Seward for the 2015 State of Alaska legislative session: 1. STATE FUNDED PROJECTS A. PORT, HARBOR, AND INDUSTRIAL AREA (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2) For an amount to be determined: Infrastructure to provide doubling the vessel transport capacity of the ship lift (Syncrolift) and associated upland improvements at Vigor's Seward Dry Dock to meet current and increasing customer demands. The current, rail- only infrastructure is inadequate. (3) $200,000 for engineering and design to replace failing infrastructure in the Seward Small Boat Harbor including A, B, C, G, K, L, and S Floats. (4) $150,000 for a 8-ton crane at or near the travel-lift dock. (5) $500,000 to pave the apron and add a wash down pad at the 50 ton travel lift. *SUBSTITUTE CITY OF SEWARD,ALASKA RESOLUTION 2014-088 B. PUBLIC FACILITIES & INFRASTRUCTURE (1) $475K For maintenance and repair of City Hall Safety Center(Houses Courthouse, City Administration, DMV, and Wildlife Trooper offices). (2) $3.2 million to construct a bypass lagoon and to dredge and dispose of sludge in the sewage lagoon serving the State Department of Corrections Spring Creek facility. (3) $250K for initial design and engineering of a new 100' x 80' metal building to replace and relocate our existing public works shop (City will provide land for the new building). (4) $2 million for expanding the Providence Seward Hospital Medical Clinic,moving the CT scanner into the facility, increasing backup generator capacity, and improving space for primary health care (City provides $500 thousand annually for hospital financing of capital improvements). (5) $450,000 for Alaska SeaLife Center veterinary and emergency spill response equipment. (6) $2 million to replace a failing roof at the Alaska SeaLife Center. C.ELECTRIC (1) $5 million to design and rebuild the transmission line from the Seward Highway to Seward Marine Industrial Center. (2) $1 million to take advantage of an existing out-of-use water main in order to bury and secure utility lines running next to the lagoon. (3) $1.5 million to repair and replace one mile of transmission line into the Fort Raymond Substation with 115kV compatible equipment(this is a project supported by the Alaska Railbelt Cooperative Transmission and Electric Company—ARCTEC—because the current condition of the transmission line exceeds the estimated life expectancy of 50- years). (4) $3 million to upgrade the Spring Creek substation in the Seward Marine Industrial Center by securing an alternative feed transformer to reduce system outages. (5) $2 million to rebuild obsolete and aging infrastructure and add new infrastructure within the expanding Camelot Subdivision where development is and growth requires the new updated system. D.ROADS, STREETS,AND ADA ACCESIBILITY (1) $2.25 million for Seward Community Roads for paving, repaving road surfaces and improve roadway drainage systems. (2) $300,000 for improving City ADA accessibility. (3) $2.496 million for design, engineering and construction to protect Lowell Point Easement road from further coastal erosion. This road is the sole land-access to critical public infrastructure, Kenai National Park, and a Kenai Peninsula Borough residential housing area. E. PUBLIC SAFETY (1) $6 million for a replacement Seward Fire Station. The City is experiencing growth on the west side (Fuel farm expansion and homes) and in the industrial area at the Marine Sb *SUBSTITUTE CITY OF SEWARD,ALASKA RESOLUTION 2014-088 Center. (City will provide a match of land). (2) $250K for initial design and engineering for a Public Safety Building (City will provide a match of land). (3) $900K dollars for a new animal shelter that is used by City and Borough citizens. 2. CRUISE PASSENGER VESSEL TAX REGIONAL IMPACT FUND OR CRUISE SHIP GAMBLING TAX (1) $200,000 to continue the seasonal bus for cruise ship passengers. (2) $15.2 million for the Alaska Railroad/Seward East Dock Expansion project to lengthen and widen the existing freight/passenger dock in Seward, Alaska. (3) $220,000 for Alaska Railroad Cruise Ship Dock Maintenance and Repair including pilings with severe corrosion, repairs of the cathodic protection system, sewer system, camel and fender repairs and miscellaneous repairs. 3. BENEFICIAL LEGISLATION (1) Full funding ($23 Million) for the State of Alaska, Department of Transportation and Public Facilities, Municipal Harbor Grant Program. (2) Support the passage of legislation that provides for reallocating the fish tax to provide a greater share to local municipal governments. (3) Legislative support for increased cash infusion into PERS/TRS retirement system in order to offset unfunded retirement system liabilities, to make future contribution rates more affordable for the state and local governments. (4) Support for continuing Medicaid programs and capital cost reimbursement at not less than current year funding levels. (5) A feasibility study for providing natural gas to the Seward Region. Section 2. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27th day of October, 2014. THE CITY OF SEWARD,ALASKA Jean Bardarson,Mayor AYES: NOES: ABSENT: ABSTAIN: VACANT: Council Agenda Statement 4"40c Sett Cgi Meeting Date: October 27,2014 From: Jim Hunt, City Manager gtASwP Agenda Item: Calendar Year 2015 City, State and Federal Priorities BACKGROUND & JUSTIFICATION:, The City annually compiles a list of projects or issues that we identify as our top City, State and Federal legislative priorities. The list of projects is compiled into a package that is distributed to the Governor's Office, our legislators, the Kenai peninsula Borough (for inclusion in their legislative package), and our lobbyist. The list validates projects and greatly focuses the efforts of the Administration in our lobbying effort as we seek funding or other resolutions both through the State of Alaska and Federal sources. This year the three lists include projects that are in the planning phase and/or may qualify for grants in addition to some projects with which Council is familiar. In order to quality for most grants, the City must include these projects on the City priority list. This year Council is being presented with two sets of City and State priorities, either can be amended. Following the Council work session on September 29th administration compiled a traditional version of the priorities using that extensive direction; however it has been recommended that the City clearly identify priorities taking the State's economic climate into consideration, resulting in a shorter and more concise list for Council consideration. INTENT: This list of priorities focuses the efforts of Administration in lobbying efforts to obtain appropriations, grants, and legislation from the State and Federal sources to improve the City of Seward. To qualify for most appropriations and grants Seward's City, State and Federal priorities lists must be approved in a public process by the City Council. CONSISTENCY CHECKLIST:, Yes No N/A 1. Comprehensive Plan: Sections 1.3 Economic Development X 2. Strategic Plan (document source here): Entirety X 3. Other (list): X ATTORNEY REVIEW: Yes No X FISCAL NOTE:, NA RECOMMENDATION: Council approve Resolutions 2014-087, 2014-088, and 2014-089, approving the City of Seward's Calendar Year 2015 City, State and Federal Priorities. 5� FROM: Port and Commerce Advisory Board TO: City Council RE: 2015 Legislative Priorities On October 1,2014 the Port and Commerce Advisory Board reviewed legislative priorities for 2015, compiling and agreeing by vote upon the following list. PORT, HARBOR, AND INDUSTRIAL AREA (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2) The expense to be determined for doubling the vessel capacity of the ship lift (Syncrolift) and associated upland improvements at Vigor's Seward Dry Dock to meet current and increasing customer demand. The current rail-only infrastructure is inadequate. (3) $200,000 for engineering and design to replace failing infrastructure in the Seward Small Boat Harbor including A, B, C, G, K, L, and S Ski.' (4) $150,000 for an 8-ton crane at (or near) the travel-lift dock. (5) $500,000 to pave the apron and add a wash down pad at the 50 ton travel lift. (6) $250,000 to complete paving and drainage improvements in the northeast parking lot of the Seward Small Boat Harbor. Sponsored by: Hunt CITY OF SEWARD,ALASKA RESOLUTION 2014-089 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, ESTABLISHING THE CITY OF SEWARD'S CALENDAR YEAR 2015 FEDERAL LEGISLATIVE PRIORITIES WHEREAS, the City annually compiles a list of projects or issues that are identified as top federal legislative priorities; and WHEREAS, the list of projects is compiled and distributed to the Kenai Peninsula Borough, our congressional delegation and City of Seward federal lobbyist; and WHEREAS, this resolution validates projects, prioritizes needs, and focuses the efforts of City Administration in its lobbying efforts; and WHEREAS,the passage of this resolution occurs through a public process; and WHEREAS, all projects on this list are consistent with the City Comprehensive and Strategic Plans. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA,that: Section 1. The following list of legislative projects is hereby declared to be the official legislative priority list of the City of Seward for 2015: A. APPROPRIATIONS AND GRANTS 1. $1 million appropriation to the Army Corps of Engineers for the City's fifty-percent cost- share for a necessary Lowell Creek/Diversion Dam study. 2. $7 million for a comprehensive Seward Flood Mitigation Program on the watershed level by the U.S. Army Corps of Engineers. 3. USDA assistance providing Senior Housing options for elders wishing to transition but find housing options in Seward limited. 4. Funding assistance for the Seward Community Health Center's structural expansion. The Center's success has resulted in the facility requiring the administration to de-centralize its offices due to a lack of space. 5. $3 million appropriation for Lowell Point Road storm surge mitigation, bank stabilization and erosion control projects (from a Section 103 study by the U. S. Army Corps of Engineers). 6. $1 million appropriation for erosion control projects (from a Section 14 study by the U.S. Army Corps of Engineers) for the Seward Marine Industrial Center and the Alaska Railroad Dock. NINO 60 CITY OF SEWARD, ALASKA RESOLUTION 2014-089 7. $2.25 million appropriation for Seward Community Roads for paving, repaving road surfaces and improving roadway drainage systems. 8. $2 million grant for constructing a 100'x 80' metal building to house emergency response equipment, and shelter supplies at the Fort Raymond Satellite Fire Station. 9. $2.496 million in the Highway Transportation Bill for design, engineering, construction, and protection from coastal erosion for the Lowell Point Road (the sole land access to critical infrastructure, state parks, and Kenai Peninsula Borough residential housing area). 10. $15.2 million in the Highway Transportation Bill to lengthen and widen the Alaska Railroad Freight Dock in Seward. 11. $250,000 for operating the Alaska strandings network and responding to marine mammal and seabird strandings and mortalities throughout Alaska. B. AUTHORIZATIONS AND BENEFICIAL LEGISLATION 1. Authorization and Appropriation for $1.2 million local government cost share owed by the City of Seward to the Army Corps of Engineers satisfying the total cost share requirements for Phase 2 of the Seward Harbor Expansion Project (additional costs were incurred in a second phase of the project to correct a design deficiency by the Army Corps of Engineers - The City has paid $469,613.22 for its share of Phase 1) 2. Authorization language amending the Water Resources Development Act of 2007 (Public 1r Law 110-114, 121 STAT. 1205) as follows: a. Amending Section 5032 (1)by striking "Tunnel" from the title; (2)by striking "Long-Term" from subsection (a); (3)by striking "Long-Term" from subsection (a)(1); (4)by striking "Long-Term" from subsection (a)(2). b. Striking subsection (b) in Section 5032 and inserting language directing the Secretary to conduct a study to determine whether an alternative method of flood diversion in Lowell Canyon is feasible. Feasibility shall be determined based on risk reduction rather than cost-benefit analysis. Federal cost share for the study shall be the same as the Federal share for the original project. Section 2. This resolution shall take effect immediately upon its adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 27`h day of October, 2014. THE CITY OF SEWARD,ALASKA `` .. Jean Bardarson, Mayor (0l FROM: Port and Commerce Advisory Board TO: City Council RE: 2015 Legislative Priorities On October 1,2014 the Port and Commerce Advisory Board reviewed legislative priorities for 2015, compiling and agreeing by vote upon the following list. PORT, HARBOR, AND INDUSTRIAL AREA (1) $1.5 million for storm water discharge infrastructure and a security fence to surround the city vessel storage area at the Seward Marine Industrial Center. (2)The expense to be determined for doubling the vessel capacity of the ship lift(Syncrolift) and associated upland improvements at Vigor's Seward Dry Dock to meet current and increasing customer demand. The current rail-only infrastructure is inadequate. (3) $200,000 for engineering and design to replace failing infrastructure in the Seward Small Boat Harbor including A, B, C, G, K, L, and S Floats. (4) $150,000 for an 8-ton crane at (or near) the travel-lift dock. (5) $500,000 to pave the apron and add a wash down pad at the 50 ton travel lift. (6) $250,000 to complete paving and drainage improvements in the northeast parking lot of the Seward Small Boat Harbor. Council Agenda Statement C0F SFw 9�Meeting Date: October 27, 2014 a ~O From: Jim Hunt, City Manager I op Agenda Item: Calendar Year 2015 City, State and Federal Priorities BACKGROUND & JUSTIFICATION: The City annually compiles a list of projects or issues that we identify as our top City, State and Federal legislative priorities. The list of projects is compiled into a package that is distributed to the Governor's Office, our legislators, the Kenai Peninsula Borough (for inclusion in their legislative package), and our lobbyist. The list validates projects and greatly focuses the efforts of the Administration in our lobbying effort as we seek funding or other resolutions both through the State of Alaska and Federal sources. This year the three lists include projects that are in the planning phase and/or may qualify for grants in addition to some projects with which Council is familiar. In order to quality for most grants, the City must include these projects on the City priority list. This year Council is being presented with two sets of City and State priorities, either can be amended. Following the Council work session on September 29th administration compiled a traditional version of the priorities using that extensive direction; however it has been recommended that the City clearly identify priorities taking the State's economic climate into consideration, resulting in a shorter and more concise list ilibep for Council consideration. INTENT: This list of priorities focuses the efforts of Administration in lobbying efforts to obtain appropriations, grants, and legislation from the State and Federal sources to improve the City of Seward. To qualify for most appropriations and grants Seward's City, State and Federal priorities lists must be approved in a public process by the City Council. CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan: Sections 1.3 Economic Development X 2. Strategic Plan (document source here): Entirety X 3. Other (list): X ATTORNEY REVIEW: Yes No X FISCAL NOTE: NA RECOMMENDATION: Council approve Resolutions 2014-087, 2014-088, and 2014-089, approving the City of Seward's Calendar Year 2015 City, State and Federal Priorities. Sponsored by: Hunt CITY OF SEWARD,ALASKA RESOLUTION 2014-090 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, RESCINDING RESOLUTION 2014-077 AND AUTHORIZING THE PURCHASE OF A PREVIOUSLY OWNED 2012 DODGE DURANGO AS A REPLACEMENT ELECTRIC DEPARTMENT VEHICLE FOR AN AMOUNT NOT TO EXCEED $21,000 AND APPROPRIATING FUNDS WHEREAS, the Electric Department's Ford Escape (vehicle #532) was involved in an collision on June 19, 2014 and subsequently deemed a total loss, a replacement vehicle must be acquired; and WHEREAS, the Escape proved to be inadequate for the purpose it was purchased and a mid-size SUV would be more appropriate; and WHEREAS, the City Council passed Resolution 2014-077 on September 22, 2014, authorizing the City Manager to purchase a new Dodge Journey using the state's procurement procedure for an amount not to exceed $23,939 from Anchorage Chrysler; and WHEREAS, Anchorage Chrysler no longer offers the 2014 Dodge Journey under the state procurement contract due to the end of the model year; and WHEREAS, the city will be receiving a check from the other driver's insurance agency for the totaled value of the Escape for an amount of approximately $21,000; and WHEREAS,the Electric Department gathered quotes for comparable vehicles; and WHEREAS, the Electric Department has located a previously owned mid-size SUV, Dodge Durango, at a local vendor for $21,000; and WHEREAS, Kelley Blue Book Website shows a fair market value for 2012 Dodge Durango in good condition to be purchased from a dealership to be valued at $24,313. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD,ALASKA that: Section 1. The City Council hereby rescinds Resolution 2014-077 to purchase a 2014 Dodge Journey on the state's procurement list. Section 2. The City Manager is hereby authorized purchase$21,000 and appropriating Durango from Hertz Seward for an amount not to exceed funds. CITY OF SEWARD,ALASKA RESOLUTION 2014-090 Section 3. Funding is hereby appropriated from the Motor Pool Fund Insurance Recovery account no. 03000-3001-4632 to the motor pool capital equipment account no. 15000-3001- 8103. Section 4. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 276 day of October, 2014. THE CITY OF SEWARD,ALASKA Jean Bardarson,Mayor '" AYES: NOES: ABSENT: ABSTAIN: ATTEST: Johanna Kinney, CMC City Clerk (City Seal) fir.. Council Agenda Statement r 4 of sFgyq Meeting Date: October 27, 2014 `�40 "" Through: Jim Hunt, City Manager 1 wt"' From: John Foutz, Electric Utility Manager Agenda Item: Rescind resolution 2014-077 and purchase a pre-owned vehicle with the insurance reimbursement BACKGROUND &JUSTIFICATION On June 19th,2014 an electric department employee was involved in a collision with another vehicle that resulted in the 2012 Ford Escape(vehicle#532)being deemed a total loss. The other driver at was found to be at fault and their insurance agency has stated in writing it will pay for the totaled vehicle. AMLJIA negotiated a final settlement with the other driver's insurance agency for an amount of$21,004.56. The Escape saved the electric department money by using it to travel to meetings out of town instead of using one of the larger vehicles with a V-8 engine. However,during some situations,the vehicle was not large enough to fulfill the needed requirements. The vehicle must be large and powerful enough to go into places during flood events or potential customers not on a maintained road. Upgrading from a small-size, 4-cylinder SUV to a mid-size, V6 SUV is necessary. On September 22nd the council passed a resolution authorizing the city manager to purchase a new vehicle using the state's procurement procedures for an amount not to exceed$23,939. The State's procurement matrix lists four vendors for a mid-size SUV, with the lowest price for the Dodge Journey SXT,model JCEE49 at$23,939.00 from Anchorage Chrysler. The dealership is no longer offering this model due to the model year close-out and they are unwilling or unable to transfer vehicles from other dealerships. The next mid-size SUV on the state's procurement matrix is approximately$3,000 higher. The electric department has located a pre-owned 2012 Dodge Durango with approximately 35,000 miles for an amount equal to the insurance settlement ($21,000)from a local vendor. Seward City Code Reference: 6.05.020(C). Minor purchase procedures. All purchases of passenger vehicles shall be subject to the provisions of§ 6.10 and shall be considered major purchases. 6.10.125. Purchase of used equipment exempt. Restrictions and provisions of this title shall not apply where the city council determines that the public interest would be best served by the purchase of used equipment and, by resolution, authorizes the city manager to locate and purchase a particular type and quantity of used Nod equipment. I r bb INTENT: To rescind resolution 2014-077 authorizing the purchase of a 2014 Dodge Journey through the state's procurement contract and purchasing a pre-owned mid-size SUV for an amount not to exceed the insurance settlement of$21,004.56. CONSISTENCY CHECKLIST: Yes No N/A 1. Comprehensive Plan X 2 Strategic Plan:The mission of the City of Seward government it is to provide quality leadership and economic wellbeing of its citizens X 3 Other(list): Consistent with the City's vehicle replacement policy established in 2009 X FISCAL NOTE: The purchase of the pre-owned vehicle will not exceed the amount received in the insurance settlement and,therefore,will not impact the electric department. Any excess funds from the insurance settlement will be miscellaneous revenue in the electric department. Approved by Finance Department: i% 44 / d"" ATTORNEY REVIEW: Yes No X RECOMMENDATION: p Council approve Resolution 2014-__,rescinding resolution 2014-077 and approving the purchase of 4ilinv a pre-owned mid-size SUV for an amount not to exceed $21,000. D Sponsored by: Hunt CITY OF SEWARD, ALASKA RESOLUTION 2014-077 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, USING THE STATE'S COMPETITIVE PROCUREMENT PROVISIONS AND AUTHORIZING PURCHASE OF A NEW DODGE JOURNEY SXT IN THE AMOUNT OF $23,939.00, AND APPROPRIATING FUNDS WHEREAS, the Ford Escape (vehicle #532) was crashed and totaled on June 19, 2014 and a replacement vehicle must be acquired; and WHEREAS, the Escape proved to be inadequate for the purpose it was purchased and a mid-size SUV would be more appropriate; and WHEREAS, the State of Alaska has a procurement contract resulting from a competitive bid process, for mid-size SUV's from four vendors in the state recommending the purchase of the Dodge Journey SXT from Anchorage Chrysler for$23,939; and WHEREAS, the city will be receiving a check from the other driver's insurance agency for the totaled value of the Escape for an amount yet to be finalized; and WHEREAS, the amount additional to the insurance reimbursement will come from the Electric Enterprise Fund reserves and is estimated to cost $2,935; and WHEREAS, purchasing this vehicle on the state's procurement saves the city approximately $7,731 versus purchasing the same vehicle from the same dealer according the their website; and WHEREAS, the state procurement price for the Dodge Journey is $1,854 over the price of the Ford Escape purchased in 2012. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA that: Section 1. The City Council hereby waives the competitive procurement requirements of the City Code in accordance with Seward City Code 6.10.120(B) which authorizes the purchase of products or services utilizing competitive bids obtained by other governmental entities. Section 2. The City Manager is hereby authorized to purchase a new Dodge Journey SXT utilizing the contract with Anchorage Chrysler, resulting from the State of Alaska's competitive bids, in the amount of $23,939. Funding for this purchase will come from insurance reimbursement proceeds with the remainder to be appropriated from the Electric Enterprise Fund reserves, charged to capital equipment account no. 15000-3000-8103. CITY OF SEWARD, ALASKA RESOLUTION 2014-077 Section 3. This resolution shall take effect immediately upon adoption. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 22nd day of September, 2014. THE CITY OF SEWARD, ALASKA Jean Bardarson,Mayor AYES: Keil, Casagranda, Terry, Squires, Darling, Bardarson NOES: None ABSENT: Butts ABSTAIN: None ATTEST: Johanna Kinney, CMC City Clerk (City Seal) b°� ol , i q,,A .r.'41 kr-74N 0 9 fay , ", . t J 2 P.' ',...-2 -- 'el)til. , :A3= ., le 2.-rx VEHICLE IS NOT h1ANUF CTU EO FOR LSAT OR REGISTRATIOSTATES UTSIDE REQUIREMENTS.UNITED STATES. MANUFACTURER'S SUGGESTED RETAIL PRICE OF Illuminated Cup Holders THIS 'ilODEL INCLUDING DEALER PREPARATION Front and Rear Interioi LED Lamps '1) Base Price: $30,995 1 ,, Ir;tericr R,7:mo'•:a!:le;Rechargeable Lamp Premium Front and Rear Floor Mats DODGE DURANGO SXT AWD Thins-Row Floor Mat Exterior Color:Bright Silver Metallic Clear Coat Exterior Paint Auxi'iar; 12-Volt Power Outlets Interior Color:Black Interior Color Interior:Cloth Lo±;'-Back Bucket Seats Full Length Floor Console Engine:3.6-Liter V6 24-Valve VUT Engine EXTERIOR FEATURES Transmission:5-Speed Automatic Transmission 18-Inca x 3.0-Inch Aluminum Wheels STANDARD EQUIPMENT ESS REPLACED 6'r OM IGtJAL EUUIPMENTi P265;60R18 BSW On/Off-Road Tires FACTIONAL/SAFETY FEATURES Power Rea le::E;<`er'ar Mirrors ii,g Fri:inlr;i-Fold-k:ay Single Speed Transfer Case Automatic Headlamps Ad',anced Multistage From Air Bags Fog og Lamp Supple mental Side Curtain Aii Bags in All Rows Laminated Front Door Glass Supplemental Front Sea:-Mounted Side Airbags Deep Tint Sunscreen Glass Active Head Restraints Pourer Locking Fuel Filler Door Child Seat Anchor System-LATCH Ready Rear Winclovii?'!:F":r'VY s cr Antilock 4-Wheel Disc Brakes Electronic Stability Control OPTIONAL EQUIPMENT Tire Pressure Monitor with Warning Lamp Customer Preferred Package 26A Electro-Hydraulic Power Steering Flexible Fuel Vehicle Hill Start Assist Delete Group Funds-Fleet Trailer Si,n/ai,i Damping Sentry Key. Theft Deterrent System DESTINATION CHARGE $95f 1 Rentut K-,4 ass Entry Saar''Control t_ TOTAL PRICE: * $31,945 INTERIOR FEATURES `r" Arr Conditioning w1Dual Zone Auto Temp Control WARRANTY COVERAGE Rear Air Conditioning with Heater 5-year or 100.000-mile Powertrain Limited Warranty. Po er iindov's i.i.iiriont One-Touch Up anti Dcvin•Feature 3-year or 36,000-mile Basic Limited Warranty. Front Passenger-Side Fold-Flat Seat 24-hour towing assistance;certain restrictions apply. Second-Row 60 r.40 Fold and Tumble Seat Ask Dealer for a copy of the limited warranties or 3rd Roc;2-Passenger Bench Seat see your owner's manual for details. Third-Row Remote Headrest Dumping � /���� � SiriusXM Satellite Radio ;,r 1 Yr Radio Subscription YEAR MILE For More Information,Cal!1-888-539-7474 POWERTRAIN WARRANTY Media Center 130 CD/MP3 r-1C frD 6 Speakers '‘'` `"1 62- Audio Jack Input for Motile Devices L.' A,-t2 fl (.�> Steering Wheel-Mounted Audio Controls �i er �� Electronic Vehicle Information Center t—L I " n ;Ns TiL,:'Te'esx;)e Steering Crlerrn :'a Door Trim Panel with Ambient Lighting Ar..senlhl_r Print:Port or Enir y DETROIT MICHIGAN L'S i I ' „ "' K n o as IissE THr i°r; Err r..❑ K&Al NORTHFIELD DGE INC 1C4-ROJAG4CC-28.1981 .1.;o.: 2513 ,Fr, 4100 PLAINFIELI AVE NE I < _r ac.irF E sE.E • c GRAND R API,DS MI 4 95 2 1032 ' 1 j I Ill ::I I iii I 1 1� � ,;1 1 1 . 11 r " U I F, rC 1 DEi L I - N UL I 1TE E I H LiNHOE E 1-...'1 1I -A"'" rEC:':r r ,i STAFF i I' ;-L 1 :, F t ! Hi ILE E U6._p: 'F EC) 5 Ili � l, � I � 1 ! I a ' -EqC rls. C)c.LJI r UCCL I' 0,, C,C3lirii FAI, ® -- . 3 11P This vehicle was built especially for Chrysler Group LLC 012 FLEET • 111.1 1,311 1111. EPA Fuel Economy Estimates These estimates reflect new EPA methods beginning with 2008 models. GASOLINE Dual Fuel Vehicle* GASOLINE CITY MPG Gasoline-Ethanol(E85) HIGHWAY MPG al 6 • Estimated Annual Fuel Cost d $2,919 23 . . Expected range based on 15,000 miles at Expected range for most drivers at$3.70 per gallon of gasoline for most drivers 13 to 19 MPG 19 to 27 MPG Combined Gasoline Your actual 'Fuel economy when Fuel Economy mileage will vary operating on E85 will depending on how you yield different values This vehicle than gasoline.See Fuel drive and maintain 19 your vehicle. Economy Guide for more information. • 10 ' 32 Illirer All SUVS A i x_..' 'AZ i See the FREE Fuel Economy Guide at dealers or www.fueleconomy.gov t l,. " GOVERNMENT 5-STAR SAFETY RATINGS PARTS CONTENT INFORMATION iverall Vehicle Score **** FOR VEHICLES IN THIS.CARLINE: sed on the combined ratings of frontal,side,and rollover. U.S./CANADIAN PARTS CONTENT' 69 o.ad ONLY be compared to other vehicles of similar size and weight. NOTE:PARTS CONTENT DOES NOT INCLUDE FINAL Safety concern:visit www.safercar.gov or call 1-888-327-4236 for more details. ASSEMBLY DISTRIBUTION,OR OTHER NON-PARTS` COSTS. rontal Driver **** FOR THIS VEHICLE: rash Passenger *** FINAL ASSEMBLY POINT: sed on the risk of injury in a frontal impact. DETROIT, MICHIGAN, U.S.A. ould ONLY be compared to other vehicles of similar size and weight. COUNTRY OF ORIGIN: ide Front seat ***** ENGINE: MEXICO TRANSMISSION: GERMANY rash Rear seat ***** sed on the risk of injury in a side impact. ollover • *** sed on the risk of rollover in a single-vehicle crash. ratings range from 1 to 5 stars (*****) with 5 being the highest. 'urce: National Highway Traffic Safety Administration (NHTSA) www.safercar.gov or 1-888-327-4236 `ety .s above are based on Federal Government tests of particular vehicles ed with certain features and options.The performance of this vehicle may differ. s+ . i bR o�.�'%is&::.im n F •r'� . „ ,, 'ns .r ";5'�u, �f.-,7::!�d'fix,e ='` ? _?�F,..., £ .K Hertz END OF SEASON -TRY IT S BUY IT SALE! 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OPENING CEREMONY Lieutenant Doreen Valadez led the Pledge of Allegiance to the flag. ROLL CALL There were present: Jean Bardarson presiding and Marianna Keil Ristine Casagranda Christy Terry David Squires Dale Butts Iris Darling comprising a quorum of the Council; and Jim Hunt, City Manager Johanna Kinney,City Clerk 1410, Will Earnhart, City Attorney Absent—None CITIZEN COMMENTS ON ANY SUBJECT EXCEPT THOSE ITEMS SCHEDULED FOR PUBLIC HEARING Scott Ogan was in the wastewater treatment business and noted some of the work his company had done in other places. He stated he would be willing to work with Merrell Brothers to help reduce the work on the dredging and disposal of the sewage at Lowell Point. Ogan discussed some energy and maintenance savings costs that could be utilized. Lynda Paquette knew the council was poised to accept the sludge dredging contract with Merrell Brothers and showed concern on the bid submitted, specifically lack of concern of human life and the timeline of the project. She requested the bidders submit timelines for this project. Paquette thought the city should leave the liner of the lagoon alone for fear of something going wrong and it becoming damaged. Tim McDonald stated he had been following the lagoon issue and noted the lack of strategic planning. Perhaps the lagoon shouldn't be there anyway. It was a serious subject and throwing money at it wouldn't make it go away. McDonald stated the measures that had been taken were management by emergency. Carl Van Buskirk thanked the council for their consideration for the well-being of the people that lived out at Lowell Point. There had been many reports on declining reviews of the City of Seward,Alaska City Council Minutes September 8, 2014 Volume 39, Page tourism season and felt it was unfair for residents and businesses to have to bear the burden of a failing wastewater treatment facility.There were some glaring concerns with the proposed dredging contract for these people, including the schedule. He did appreciated council's concern and understanding of the gravity of the situation. Sue Lang owned a campground abutting the treatment facility at Lowell Point.The numbers were not in, but it looked like her business didn't break even for the summer season. Residents of Lowell Point had been inhaling hydrogen sulfide for 60 days. She has a terrible cough and a lot of people were not feeling well. She thanked council for the time put into this project, and hoped they could come to a beneficial remedy for everyone. Tom Miller of Lowell Point noted the number of guests at Miller's Landing;they had about 35,000 guests come through their facility. A lot of them were Alaskans, and Miller pointed out Lowell Point helped represent the tourism industry of Seward. He hoped council would keep that in mind when considering the dredging contract that would be finished no later than June 15, 2015. APPROVAL OF AGENDA AND CONSENT AGENDA Motion (Kei lCasagranda) Approval of Agenda and Consent Agenda Mayor Bardarson requested an agenda item be added under Special Orders, Presentations and Reports to acknowledge the State Legislature's In Memoriam Proclamation for the late Vanta Shafer. Ned Motion Passed Unanimous The clerk read the following approved consent agenda items: Resolution 2014-075, Requesting The Alaska Board Of Fisheries Hold Its 2017 Upper Cook Inlet Finfish Meeting On The Kenai Peninsula,And Approving Kenai Peninsula Borough And Municipalities Joint Resolution 2014-01. Appoint Sandie Roach' to the Historic Preservation Commission with a term May, 2015. Direct staff to send out a letter of support from the Mayor on Chugach Electric's grant application to fund assessing Fourth of July Creek as a hydroelectric energy resource. SPECIAL ORDERS, PRESENTATIONS AND REPORTS Formal Introduction of Mural Delegates from Obihiro,Japan 1. Murai Kazunori, International and Domestic Relations Section Manager 2. Shiota Akira,Art Teacher 3. Ikeda Midori,Artist 4. Umetsu Mika,Art Teacher 5. Nosaka Takehide, Calligraphy Teacher 6. Josh Neta, International& Domestic Relations Section Interpreter 7. Hayashi Nobuhide, City of Obihiro Official (arriving 9/12/14) 1 City of Seward, Alaska City Council Minutes September 8,2014 Volume 39, Page 8. Natsubori (Anderson) Motoko, Obihiro International Friendship Association Member (arriving 9/12/14) 9. Yamazaki Chizuko, Obihiro International Friendship Association Member (arriving 9/12/14) Proclamations &Awards Certificate of Appreciation for citizens Ronn Hemstock,Jill Hemstock and Stephanie Cronin for ensuring the safety of others in the community. State Legislature's In Memoriam Proclamation for the late Vanta Shafer. Borough Assembly Report,Sue McClure stated the assembly met September 1, 2014 and accepted $6 million worth of state grant money, which was their annual formal legislature acceptance.$500,000 went to the Seward Bear Creek Flood Service Area Board for flood mitigation and $545,000 was accepted in revenue sharing from the state which went to the unincorporated communities of the borough. McClure noted the state was very generous to the borough. The assembly passed an ordinance that extended tax exemption filing deadlines for senior citizens and veterans with the hopes there would be fewer late filings.The Borough Assembly passed a resolution similar to Resolution 2014-075 on the council's agenda tonight.The annual community meetings to discuss revenue sharing and projects would take place September 27, 2014. The assembly's next meeting would take place in Homer. City Manager's Report, City Manager Jim Hunt stated the following purchase orders between $10,000 and$50,000 were approved by the City Manager since the last council meeting: $11,530.56 to NC Machinery requested by the Harbor for loader repairs;$16,850.00 to Keco Pump & Equipment requested by the Harbor for pumps for the sewage waste from vessels; and $10,245 listed under Electric report and previously approved by Council as part of the Electric Warehouse Project. • Administration reported the project manager position had been filled and Rick Wise would be a great asset to the city. He had strong experience in water and wastewater projects. Wise would be starting the third week of September and would be introduced to council shortly thereafter. In Public Works, staff in the water/wastewater department were monitoring, testing, and documenting our wastewater lagoon performance. They were beginning to see improvements and were continuing aggressive odor control measures. Periodic saturation of calcium nitrate at Lowell Point and continual addition of calcium nitrate at the Lift Stations would continue. Thirty-year employee Rex Davis of the Street Department indicated he would be retiring at the end of November. In the Parks and Recreation Department, the After School Program had increasing attendance. Sports and Recreation staff was preparing for fall adult sports leagues and Parks Maintenance and Campground crews were busy with a high surge of campers,due to good weather �1r ' and great fishing. So far this season the campgrounds sold 18,400 camping permits with revenue totaling $530,000, not including caravans. �) City of Seward,Alaska City Council Minutes September 8,2014 Volume 39,Page The Electric Department reminded council if they would like to tour Chugach's new power plant to please let them know. The department was developing a request for power from the Railbelt Utilities, other than Chugach Electric. Although the city had a contract with Chugach Electric for power and a great relationship with them,the department was taking advantage of the opportunity to price shop. In the Harbor Department,the restroom was finished at the Seward Marine Industrial Center (SMIC). The travelifts on both sides of the bay had been busy and the wash-down pad was being used heavily. The delivery date for the new 330 Ton Travelift was late February,with assembling to begin the et week of March, 2015. Long recapped the tsunami warning system that went off unexpectedly last week. Long felt the city needed better communication with all agencies. Social media worked well with accurate information clarifying a false alarm had occurred. The announcement following the alarm of tuning to a local radio station was frustrating because nothing was on the radio in Seward.The borough was considering deleting that phrase from their siren alarm announcement.Long emphasized what didn't work well was calling into the city's dispatch services, who were completely overwhelmed and overused. Long encouraged everyone to have a personal evacuation plan. In response to Butts, Hunt stated the city did not have a charge for the RV sewage dumping station, but there were plans to do so. Darling requested information on how many youths were spending time at the Rec Room. Motion (Terry/Casagranda) Amend the agenda to add the following under "Other New Business": Schedule a Work Session to review the 2015 local, state, and federal legislative priorities. Motion Passed Unanimous Consent City Attorney's Report,City Attorney Will Earnhart stated briefly reviewed the structure of the City Council. A lot was covered in the code and charter. Seward City Code 2.10.090 stated council was not to interfere with administrative service and personnel matters.The reasoning for that was they hired the City Clerk,City Attorney, and City Manager for their expertise. It was important for council to ask questions,but to not micro-manage administrative duties of the City Manager. He advised them to be careful in that regard and to give wide direction. Admittedly, there were gray areas, but to be very aware of this structure. It had been a busy month for the attorneys and administration.Issues were being dealt with accordingly.Terry asked if it was in council's purview to keep apprised of anything related to the city. Earnhart confirmed it was in council's purview but any personnel matters should be discussed in executive session. Further,he stated it was council's duty to request they be made aware of things regarding the city. Keil thought that was very contrary to previous direction given by the former attorney; they were told in the past that council was not to get involved with personnel matters. Earnhart clarified council shouldn't be involved in personnel matters regarding hiring and firing staff,except for the clerk,attorney,and manager—it came down to the performance of their appointed officials. , Other Reports, Announcements and Presentations 1'3 City of Seward,Alaska City Council Minutes September 8, 2014 Volume 39,Page liktro► Providence Seward Medical Center Quarterly Update by Joe Fong. Quarterly Report by the Port and Commerce Advisory Board. Update on the Mariner's Memorial Project. PUBLIC HEARINGS Resolution 2014-073,Authorizing The City Manager To Enter Into A Lease Amendment With Harmon Properties LLC For Lot 3, Block 3 Fourth Of July Creek Subdivision, Seward Marine Industrial Center, Kenai Peninsula Borough, Plat No. 97-27 Seward Recording District,Third Judicial District, State Of Alaska. Motion (Terry/Casagranda) Approve Resolution 2014-073 Long stated the lessee proposed to purchase the land currently being leased. Council gave direction to not pursue a sale at this time, so this was an alternative to lease the land for a longer period of time. He appreciated Mr. Harmon coming back with this request and felt Harmon was a good long term tenant to enter into a longer lease with. It was consistent with land use plans and other policies of the city. r► Notice of the public hearing being posted and published as required by law was noted and the public hearing was opened. No one appeared to address the Council and the public hearing was closed. Casagranda asked how many nonstandard leases like this existed in the city.Long said he was unaware,but he knew the standard lease term of 20 to 30 years was traditional in Seward,but leases could be for a longer term. Butts wondered how many SMIC leases were in the 99 year range. Long said this would be the first one. Keil asked if other people with leases could request longer leases, Long confirmed they could. Bardarson requested there be some kind of performance clause incorporated in future lease agreements. Motion Passed Unanimous UNFINISHED BUSINESS -None NEW BUSINESS Resolution 2014-074,Authorizing The City Manager To Enter Into A Contract With Merrell Bros.,Inc. For An Amount Not To Exceed$3,988,530 For The Sludge Removal And Disposal At The Seward Marine Industrial Center(SMIC) And Lowell Point Wastewater Treatment 1 City of Seward,Alaska City Council Minutes September 8,2014 Volume 39, Page Facility (LPWWTF),And Appropriating Funds. Motion (Terry/Keil) Approve Resolution 2014-074 Hunt said this contract had been pursued for a long time now. The city had secured funding and intended to enter into a loan for additional funds,as well as to use state legislative funds for this project. By unanimous consent, council suspended the rules to allow Dustin Smith from Merrell Brothers to speak and answer any questions from the council. Keil said she reviewed the company's application and found it to be very comprehensive. Butts said they've discussed a possibility to change the contract to include odor control prior to dredging and asked if Merrell Brothers could accomplish odor control in 30 days. Smith said there were many factors to consider. There was likely odor control needed for the matter coming in and control for the matter on the bottom of the lagoon(sludge). Smith stated Merrell Brothers was not the company to use for matter coming into the lagoon. They could remediate the bio-solids on the bottom by injecting chemicals which would help with the odor. There would be some unsubstantial added costs for that. In response to Butts,Smith stated their company could accomplish this if there was a change order to the contract, and Merrell Brothers would have to work with a subcontractor, but it was possible. Terry asked if part of the sludge removal would be an inspection of the liner. Public Works Director W.C.Casey said it was just good business practice for something that had wear and tear to be inspected,especially since it had not been inspected for the last 22 years.They don't want a tear in the liner of the sewage lagoon, so it would be a good measure to inspect the liner when the sludge was removed. Terry thanked the contractor for coming tonight. She noted it was standard to dredge the sludge on the bottom and she confirmed with Smith they were very conscious of not damaging the liner and would use extreme care. Hunt addressed the timeline of the project and noted the controls for mobilization. Smith noted they do this work all over the country in many climates.For this project,the weather had to be above freezing, which was a concern for the timeline. The equipment would be coming from the lower 48 and there were some jobs the equipment was reserved for prior to beginning on the Lowell Point Sewage Lagoon. The permitting process with the Department of Environmental Conservation (DEC)and was a lengthy process. In response to questions,Casey did not foresee the liner caving in. In response to Bardarson,Smith said they were prepared to mobilize their equipment prior to temperatures coming above freezing,so as soon as temperature allowed for it in the springtime,they could start work immediately. Merrell Brothers intended to work 24 hours, 6 days a week to complete the project as quickly as possible. With sewage lagoons,it was difficult to determine how much material was actually there. The initial work that had been done to date was about as good as could be done. They were prepared to complete the project before June 15, 2014. Casagranda said Seward mostly dealt with rain in the winter time,not freezing temperatures.She D City of Seward, Alaska City Council Minutes September 8, 2014 Volume 39, Page didn't foresee the winter being below freezing in March. The numbers run on the sludge lagoon were Nrw changed to be significantly lower in volume, and asked how Merrell Brothers felt about going into the contract not knowing how much sludge was in there and what were they going to do if there was more sludge than anticipated. Smith said when considering the temperatures, they looked at averages. He stated he could not afford to send up crew and equipment simply to wait on temperatures to rise. Merrell Brothers would be mobilizing equipment early spring 2015, and if it was warmer than average,they could start earlier. The equipment the company had for this project would be available as soon as sail dates allowed, which would be a couple months ahead of the project. In response to Darling, Smith stated dredging in October and November was difficult with the equipment being in use this fall and also factoring in the lengthy permitting process with DEC. Smith assured council they would start right away for land application permits,which typically took 60-90 days. Both those things would prevent them from starting this fall. In response to Darling, Smith said the sludge was charged by how much was removed,so if more needed to be removed than authorized in the contract, council would need to authorize a change order. Terry understood this project was bid by volume and changing the scope of the project such as taking out the SMIC portion of this project would force the entire project to be re-bid. She emphasized how much the city needed to stay on top of odor control. She was in favor of voting for this resolution, and stated there were other options to pursue in conjunction with this contract. Stow Hunt said there was a reduction in the loading and odors because the temperature had dropped and less people were in town.Darling requested the city continued to add calcium nitrate to the lagoon now they knew it was a good temporary solution. Casagranda said she was not in favor of an April 1,2015 start date and would rather look at the technology presented to them tonight. She thought this plan was detrimental to the Lowell Point business community. Motion to Postpone (Darling/Casagranda) Postpone Resolution 2014-074 to the September 22,2014 meeting. Earnhart said the procurement process was followed correctly and any new discoveries were not new enough to explain why vendors couldn't have bid during the public bid process. If they didn't pass this resolution and instead wanted to utilize other technologies,the project would need to go through the bid process again.He cautioned council that not accepting the bid negotiated might be subject to dispute. Bardarson said approving this resolution didn't mean the city couldn't do odor remediation in the meantime and expressed her intent to move forward with the contract. Darling clarified odor remediation wouldn't even be part of this bid; Earnhart agreed it appeared to be a separate part of the project. In response to Casagranda,Earnhart noted postponement wouldn't be an issue,but deciding to sole source to someone else may be subject to litigation. City of Seward,Alaska City Council Minutes September 8, 2014 Volume 39,Page Motion to Postpone Failed Yes: Casagranda No: Darling,Terry,Butts,Keil,Bardarson Main Motion Passed Unanimous Other New Business Items Discuss Seward Marine Industrial Center(SMIC)electrical infrastructure needs and options. (Hunt) Hunt stated this agenda item wouldn't be necessary at this time and requested council give the SMIC Development Project more time to develop.Terry thought electric infrastructure needs and option should be implemented in the SMIC development plan that was coming forward. She hoped Alaska Industrial Development and Export Authority(A1DEA)could make recommendations on this topic and requested recommendations to review. Schedule a Work Session to review the electric rate study for September 22,2014 at 5:30 p.m. Schedule a Work Session to review the 2015 city, state, and federal legislative priorities. Council scheduled the work session for September 29, 2014 at 5:30 p.m. INFORMATIONAL ITEMS AND REPORTS Quarterly Report by the Planning and Zoning Commission. Nominations for the 2014 Historic Preservation Award due September 30, 2014. COUNCIL COMMENTS Keil welcomed the Obihiro artists. She stated she would be gone September 9—18,2014 this month. The Alaska Historical Society and Museums Alaska joint conference was coming up. The Seward Music and Arts Festival was also coming up and they needed volunteers. She attended the Founder's Day celebration for Seward and noted the event was well attended.The CROP Walk was also a success. She attended a Community Health Center coordinating committee meeting,where the topics were budgeting and the need for more space. She hoped people could come out for the upcoming blood drive. Terry stated Tuesday was the Flood Risk Informational meeting and next Thursday there was a meeting on the airport master plan.On September 10,2014 the Seward Recreation Committee was meeting.A Mexican Navy training ship was coming to Seward on September 15-19,2014 and would be providing tours. She thanked all the volunteers on committees. The community was run by volunteers and she thanked them for their service. She requested administration provide recommendations at their first November meeting on what would be done for odor control so it doesn't drop off the city's radar. She requested November so that the new project manager could get settled and familiar with the project. Butts thanked everyone who worked on the Mariner's Memorial. He thanked those from Lowell Point who attended the meeting tonight and congratulated citizens Ronn Hemstock, Jill City of Seward,Alaska City Council Minutes September 8, 2014 Volume 39,Page Hemstock and Stephanie Cronin for their commendable work. He recently attended a Kenai Peninsula Economic Development District meeting(KPEDD)and noted the organization was trying to get their name out there a little more.Butts reminded the public there were still two spots open on the Planning and Zoning Commission. Casagranda thanked Sandie Roach' for her Historic Preservation Commission application and for her community involvement. She reiterated to administration to keep bringing the issue of odor control at the sewage lagoon to the council. Sooner than November, was her preference. Casagranda hoped administration would give direction to the contractor to have a large amount of outreach to the residents of Lowell Point with regards to this project. Darling reiterated Terry and Casagranda's comments and wanted administration to explore advanced technology that ate sewage lagoon sludge in the meantime. Darling said Pat Williams would be 105 this month and thought that deserved acknowledgement. Bardarson hoped the issue at Lowell Point would be resolved quickly. She thanked those who volunteered and those who helped take care of each other.Seward was a city that volunteered in many different aspects and was a very giving community. Hunt said if people could find the time,to please visit the Peking Restaurant and keep the owners in their thoughts.He hoped the Great American,Great Alaskan Dave Squires felt better soon. ' ,,, Long stated the Department of Commerce, Community, and Economic Development (DCCED) was reviving a publication called Quarterly Economic Indicators, and was requesting KPEDD's help with the publication. CITIZEN COMMENTS Tim McDonald wondered if Pat Williams was the oldest person in the state. He inquired how much the dredging contract was for. Oxygen was the only thing to really make the odor disappear and thought the city should double the oxygen injection to the sewage lagoon. McDonald did not see any strategic planning and the council signed off on an open-ended contract. The city needed a strategic plan before spending the kind of money authorized this evening. Scott Ogan said his company had a machine with advanced oxygenation processing and he would be happy to help the city with odor control. He had a test tank he could use to pump and test and see the effect on the sludge.He was willing to work with the contractor and/or the city to work to find the best solution to the problem. Deborah Altermatt thanked Terry for her announcement regarding the Mexican Navy training ship, the Cuauhtemoc. They came to Seward in 2005 as well. Members of the community were trying to pull together some activities and really welcome the crew while they docked in Seward. The Cuauhtemoc would be in Seward from September 15-19, 2014. COUNCIL AND ADMINISTRATION RESPONSE TO CITIZEN COMMENTS City of Seward,Alaska City Council Minutes September 8, 2014 Volume 39, Page Casagranda said she spoke Spanish and could help out with the Mexican ship. Darling asked when exactly the ship was coming in. Altermatt said it was unknown at this time. The Chamber of Commerce was involved as well in welcoming the ship.Altermatt said it was a joint effort so anyone interested could contact her to get involved. ADJOURNMENT The meeting was adjourned at 9:37 p.m. Johanna Kinney, CMC Jean Bardarson City Clerk Mayor (City Seal) Agenda Statement e of sE. Meeting Date: October 27, 2014 4 9� From: Johanna Kinney, City Clerk Agenda Item: Nominate, elect and swear in a Vice-Mayor BACKGROUND&JUSTIFICATION: Per Seward Charter 3.3, Seward City Code 2.10.020 and City Council Rules of Procedures Rule 4, the City Council must meet and organize no later than 30 days after each regular city election. At this organizational meeting after new members are sworn in, the next item of business is for the Council to nominate and elect one of its members to act as Vice-Mayor in the absence of the Mayor. The City Council must select one of its members to serve as Vice Mayor. The Vice Mayor chairs the meetings in the absence of the Mayor and fills in for the Mayor at ceremonial functions when the Mayor is unavailable. In the absence of the Mayor,the Vice-Mayor shall possess all the powers of the mayor and all duties required of them by law or the City Council. Sire Recommended Procedure: 1. The Mayor/Presiding Officer should open nominations. 2. The Mayor/Presiding Officer or any council member should then nominate a council member for Vice-Mayor. 3. If only one nomination is received,a motion should be made to close nominations and cast a unanimous ballot for the chosen person. That motion will need a second and can be approved by unanimous consent(no roll call is necessary). 4. If more than one nomination is received,ballots are prepared for each council member to sign and vote for a nominee,or council can conduct a voice vote. It takes four affirmative votes to be appointed. RECOMMENDATION: Nominate and appoint a Vice-Mayor. The City Clerk will then proceed to swear them in. Slimy Memorandum e &sett, Date: October 27, 2014 ;7.1 q�SKP From: Johanna Kinney, City Clerk 17 Subj: Annual organization of the uncil appointment of Kenai Peninsula Economic Development District Representative An action needing attention during this organizational meeting of the City Council is the appointment of the Kenai Peninsula Economic Development District's (KPEDD) City of Seward representative. Council Member Dale Butts has been the representative serving on the Board of Directors, with a term that expires December 31, 2014. ********************************************************************************* Recommendation: After discussion,the Mayor appoint a city representative to the KPEDD beginning January 1,2014. City Council Rules of Procedure RULE 4. The City Council must meet and organize not later than 30 days after each regular city election. At this organizational meeting,the Council elects one of its members to act as Vice-Mayor in the absence of the mayor. In addition,the Mayor may appoint the council liaison to the Planning Commission and the council representative to the Kenai Peninsula Borough Economic Development District. [See Rule 29(c) and SCC§2.10.020] RULE 29. (c) Council Liaisons. In order to build additional Council expertise in various areas of city operations, the Presiding Officer may appoint one Council member to serve as a liaison to the Planning and Zoning Commission. These appointments shall be made at the Council's organizational meeting in October. If appointed,the council representative to the Kenai Peninsula Borough Economic Development District shall serve as liaison to the Port and Commerce Advisory Board. If council liaisons were not appointed, a member of each Board and Commission will arrange to give periodic reports to the city council during Council's regular scheduled meetings. g6 Nord Memorandum e j OF sets.q Date: October 27,2014 t. 14.ASKP From: Johanna Kinney, City Clerk Subj: Direction to Boards and Co ssions to give periodic reports to the council. It's that annual time of the year where the council must organize within 30 days after the regular city election and select either council members as Board and Commission liaisons or direct Boards and Commissions to give periodic reports to the council. Resolution 2005-071 was approved on August 5, 2005. This approved slight amendments to the Council Rules of Procedures by taking out the word "shall" and replacing it with "may"to allow future councils the option to either appoint liaisons from council or to have individuals from each of those Boards and Commissions give periodic reports to the City Council at their regular meetings. The past few years, council has chosen to direct Boards and Commissions to give periodic reports to the City Council, although council certainly could appoint liaisons to the Boards and Commissions. ****************************************************************************** ,,,, • Recommend after discussion, the Mayor appoint a liaison with the Boards and Commissions or request periodic reports be given to the City Council. If the council wishes to have council liaisons to the Boards and Commissions, the council member appointed to the Kenai Peninsula Economic Development District (KPEDD) will automatically be the PACAB liaison. City Council Rules of Procedure RULE 4. The City Council must meet and organize not later than 30 days after each regular city election. At this organizational meeting, the Council elects one of its members to act as Vice-Mayor in the absence of the mayor. In addition, the Mayor may appoint the council liaison to the Planning Commission and the council representative to the Kenai Peninsula Borough Economic Development District. (See Rule 29(c) and SCC§2.10.020] RULE 29. (c) Council Liaisons. In order to build additional Council expertise in various areas of city operations, the Presiding Officer may appoint one Council member to serve as a liaison to the Planning and Zoning Commission. These appointments shall be made at the Council's organizational meeting in October. If appointed, the council representative to the Kenai Peninsula Borough Economic Development District shall serve as liaison to the Port and Commerce Advisory Board. If council liaisons were not appointed, a member of each Board and Commission will arrange to give periodic reports to the city council during Council's regular scheduled meetings. 4 O SFh• '( 0 dt.AsKP AGENDA STATEMENT Meeting Date: October 27, 2014 From: Johanna Kinney, City Clerk Agenda Item: Non-objection to the new liqu license for Zudy's Café. BACKGROUND &JUSTIFICATION: The City Council has an opportunity to object to the request for a new liquor license for Zudy's Café. The City of Seward Police, Fire, and Finance Departments and the Kenai Peninsula Borough Finance Department have no objections to the liquor license for this business. FISCAL NOTE: In the event the City of Seward chooses to file a protest for the above liquor license application, then under Alaska Statutes the City of Seward will be required to assist in, or undertake the defense of its protest. RECOMMENDATION: Non-objection to the Restaurant/Eating Place — Public Convenience Liquor License #5356 for Zudy's Café. ryof sett, III''• 41-ASKP MEMORANDUM Date: October 13, 2014 �,�t To: Naneth Ambrosiani f �`� Finance/Leases Kari Atwood Finance/Public Utilities Chief Tom Clemons Police Department Chief Eddie Athey Fire Department From: Brenda Ballou, Deputy City Clerk RE: Verifying Compliance For A New Liquor License Application The following business has applied for a new liquor license. Please review for compliance with all utilities, lease payments and assessments. Thank you. Name of Business: Zudy's Café Type of License: Restaurant/Eating Place Public Convenience License Number: 5356 Department Status Initials Finance/Leases Ofr- OA Finance/Utilities 61 Police Chief Q Fire Chief 101$UL4 KENAI PENINSULA BOROUGH A 144 North Binkley St., Soldotna, Alaska 99669-7520 �� 1-800-478-4441, Ext. 2160• 907-714-2160 • Fax 907-714-2388 " G' pc,l www.kpb.us • assemblyclerk@kpb.us NA JOHN! BLANKENSHIP, MMC BOROUGH CLERK October 21, 2014 Ms. Sarah Oates Records&Licensing Supervisor Alcoholic Beverage Control Board 2400 Viking Drive Anchorage,AK 99501-1768 RE: Non-Objection of New License Application Business Name Zudy's Cafe License Type • Restaurant/Eating Place Public Convenience Nod License Location • City of Seward License No. 5356 Dear Ms. Oates, This serves to advise that the Finance Department has reviewed the above referenced application and has no objection to the issuance of this license. Should you have any questions, or need additional information, please do not hesitate to contact our office. Sincerely, a—a..- Johni Blankenship, MMC Borough Clerk JB/klr cc: City of Seward Applicant KPB Finance Department File �b No of T73, //7; • THE STATE Department of Commerce, Community, fALA KA. and Economic Development � "^' AI_C01101 IC BFVFRAGF(ONI ROI_ BOARD GOVERNOR SEAN PARNEI,I, r1 OF4e n"'1 2401)'vikr D i ti;*P. Anchorage, Alacka 99.901 Mar,:967.269.935C; TDD;907.465.5437 Fa/:9(7 ;422?% October 3,2014 City of Seward Attn: Johanna Kinney clerk @cityofseward.net Zudy's Café LLC DBA Zudy's Café—License#5356 10 New Application ❑ Transfer of Ownership ❑ Transfer of Location El Restaurant Designation Permit ❑ DBA Name Change We have received an application for the above listed licenses (see attached application documents)within your jurisdiction. This is the notice as required under AS 04.11.520. Additional information concerning filing a"protest"by a local governing body under AS 04.11.480 is included in this letter. A local governing body as defined under AS 04.21.080(11)may protest the approval of an application(s) Saw pursuant to AS 04.11.480 by furnishing the board and the applicant with a clear and concise written statement of reasons in support of a protest within 60 days of receipt of this notice. If a protest is filed, the board will not approve the application unless it finds that the protest is"arbitrary, capricious and unreasonable". Instead,in accordance with AS 04.11.510(b),the board will notify the applicant that the application is denied for reasons stated in the protest. The applicant is entitled to an informal conference with either the director or the board and,if not satisfied by the informal conference, is entitled to a formal hearing in accordance with AS 44.62.330-44.62-630.IF THE APPLICANT REQUESTS A HEARING, THE LOCAL GOVERNING BODY MUST ASSIST IN OR UNDERTAKE THE DEFENSE OF ITS PROTEST. Under AS 04.11.420(a),the board may not issue a license or permit for premises in a municipality where a zoning regulation or ordinance prohibits the sale or consumption of alcoholic beverages,unless a variance of the regulation or ordinance has been approved. Under AS 04.11.420(b)municipalities must inform the board of zoning regulations or ordinances which prohibit the sale or consumption of alcoholic beverages. If a municipal zoning regulation or ordinance prohibits the sale or consumption of alcoholic beverages at the proposed premises and no variance of the regulation or ordinance has been approved,please notify us and provide a certified copy of the regulation or ordinance if you have not previously done so. Protest under AS 04.11.480 and the prohibition of sale or consumption of alcoholic beverages as required by zoning regulation or ordinance under AS 04.11.420(a)are two separate and distinct subjects. Please bear that in mind in responding to this notice. Stow `� 1 AS 04.21.010(d),if applicable,requires the municipality to provide written notice to the appropriate community council(s). If you wish to protest the application referenced above,please do so in the prescribed manner and within the prescribed time. Please show proof of service upon the applicant.For additional information please refer to 13 AAC 104.145,Local Governing Body Protest. Note: Applications applied for under AS 04.11.400(g), 3 AAC 304.335(a)(3),AS 04.11.090(e), and 3 AAC 304.660(e)must be approved by the goveming body. 4,1-At/A--ea Maxine Andrews Business Registration Examiner Direct line: 907-269-0358 Email: maxine.andrews @alaska.gov State of Alaska ' Alcoholic Beverage Control Board Date of Notice:October 3,2014 Application Type: x New TRANSFER Ownership Location Name Change Governing Body: City of Seward Community Councils: n/a License#: 5356 License Type: Restaurant/Eating Place Public Convenience D.B.A.: Zudy's Café Licensee/Applicant: Zudy's Café LLC Physical Location: 501 Railway Ave. Mail Address: Box 171 Seward,AK 99664 Telephone#: 907-224-4710 or 907-288-3678 EIN: 46-5153827 r.Corp/LLC Agent: Address Phone Date and State of Good Incorporation standing? Zudy's Café LLC Box 171 907-224-4710 3/24/2014 yes Seward,AK 99664 Alaska Please note:the Members/Officers/Directors/Shareholders(principals)listed below are the principal members. There may be additional members that we are not aware of because they are not primary members. We have listed all principal members and those who hold at least 10%shares. Member/Officer/Director: DOB Address Phone Title/Shares(%) Jan Odhner Box 176 907-288-3678 Member Moose Pass 50% Judy Odhner Box 176 907-288-3678 Member Moose Pass 500 13 Page 2 A local governing body as defined under AS 04.21.080(11) may protest the approval of an application(s) pursuant to AS 04.11.480 by furnishing the board and the applicant with a clear and concise written statement of reasons in support of a protest within 60 days of receipt of this notice. If a protest is filed,the board will not approve the application unless it finds that the protest is"arbitrary,capricious and unreasonable". Instead, in accordance with AS 04.11.510(b), the board will notify the applicant that the application is denied for reasons stated in the protest. The applicant is entitled to an informal conference with either the director or the board and, if not satisfied by the informal conference, is entitled to a formal hearing in accordance with AS 44.62.330-44.62-630. IF THE APPLICANT REQUESTS A HEARING,THE LOCAL GOVERNING BODY MUST ASSIST IN OR UNDERTAKE THE DEFENSE OF ITS PROTEST. Under AS 04.11.420(a),the board may not issue a license or permit for premises in a municipality where a zoning regulation or ordinance prohibits the sale or consumption of alcoholic beverages, unless a variance of the regulation or ordinance has been approved. Under AS 04.11.420(b) municipalities must inform the board of zoning regulations or ordinances which prohibit the sale or consumption of alcoholic beverages. If a municipal zoning regulation or ordinance prohibits the sale or consumption of alcoholic beverages at the proposed premises and no variance of the regulation or ordinance has been approved, please notify us and provide a certified copy of the regulation or ordinance if you have not previously done so. Protest under AS 04.11.480 and the prohibition of sale or consumption of alcoholic beverages as required by zoning regulation or ordinance under AS 04.11.420(a)are two separate and distinct subjects. Please bear that in mind in responding to this notice. AS 04.21.010(d), if applicable, requires the municipality to provide written notice to the appropriate community council(s). If you wish to protest the application referenced above, please do so in the prescribed manner and within the prescribed time. Please show proof of service upon the applicant. For additional information please refer to 3 AAC 304.145, Local Governing Body Protest. Note:Applications applied for under AS 04.11.400(g),3 AAC 304.335(a)(3),AS 04.11.090(e), and 3 AAC 304.660(e) must be approved by the governing body. 4,410 apitta Maxine Andrews Business Registration Examiner Direct line:907-269-0358 Email: maxine.andrews @alaska.gov 161 • Alcoholic Beverage Control Board New Liquor License �`' Drive (907)269-0350 t 'AK 99501 Fax:(907)334-2285 bttpJ/commerce alaslca.govidnn/abc/Home,aapx License is: IJ 1' ��e' udl Year OR ❑Seasonal List Dates of Operation: L SECTION A-LICENSE INFORMATION FEES � - License Type 1 -171 License yaulD0 - Re5T1 &irtsir E94T l NG see.04.11.1186 nth RACE ok"`-5 putL C CaNEW I F--&/CE Fee: $100.00 License#: 5 (0 Rest.Desig.Permit d Local Governing Bode(City,Boron or Fen $ �� �7Umotgmixed) Camm�mity Council Naane(s)&Mailing Address: ► rY CIA! hip F $ ��3 v+ Name of Applicant ,.A , �3 -Z(4 Doing Business As(Business Name): Business Telephone Number: LL C ZUDY 5 C/WE 9O7' 22ii-'/7to Fax Number: N/A Mailing Address: Street Addressor Location of Premises !mail Address 130X ( "1! 50( MIL-WAY ME &hi o4 s rkRD , / 99 619 cdr I SECTION B-PREMISES TO BE LICENSED Distance to closest school rsanarsmlaade O Premises is GREATER than 50 miles from the boundaries of an t !u =4 11.410 OR iacoapocabed city,borough,nil sr • mrmitprli�+ 5. t 45 O Local°idi moe No. 0 Premises is LESS than so mi sr from the bt>maar;ee of u incoiporated v6:4 city,borough,or unified mom'.Distance to closest chinch: Distance aaasaasniadm [pot applicable 2600 -rt IR AS O4.11.410 OR °Local ordinance No. Premises to be licensed is D Plms submitted to Fire Marshall(required for sew&proposed ° building 0' of premises attached t�Bxisdag scram' °New building New Application Page 1 of 3 l� Alcoholic Beverage Control Board New Liquor License 2400 Viking Drive ( 334- s Anchorage AK 99501 Fax:(907)334-2285 hrtp://conmserce.altudoL govidaneabr/Home.aspx SECTION C—LKZNSEE INFORMATION 1. Does any individual,corporate officer,director,limited liability organization member,manager or partner named in this application have any direct or indirect interest in any other alcoholic beverage badness licensed in Alaska or any other state? O Yes Na If Yes,complete the following. Attach additional shiers if necessary. Name Name of Barham Type of License , Badness Street Address , State 2. Has any individual,corporate officer,director,limited liability organiation member,manager or partner named in this application been convicted of a Team,a violation of AS 04,or bean convicted as a licensee or manager of licensed premises in another state of the liquor laws of that state? 0 Yes I No If Yes,attach written explanation. SECTION D—OWNERSHIP INFORMATION-CORPORATION Cesporedens,LL(h,LLPs awl LPs must be twittered with the Dept of Commtosity and B*ruade Drat. Name of Boaigr( /LP)(or N/A If individual ownership): Telepbaoe Number: Fan Number: Z u D Y s CA-Fe ' LI_C 4107-24i- 1TO nr f�-- Commie&Wain Mike= City: IA-S 0— riP Yq 66 4 Nuns,Maiiieg Address sad Telepho,Number of Reg eel Algae 507' Z69734434'718 Dateof looanparatioe OR Suns of laeorpmttm: Titv 6N-hvE/ OW 174 MCTS5 ASS Certification wrhDOM: Atit5 Is the Fatly in"Good Stsod ne with the Meeks Division ofCerpaatiam9 E Yes D No 1f ao,attach written esphoatios Your entity mai be in Goan an=with Tale 10 ofthe Alaska Samoan to be a valid liquor bceoaee. Entity Mambas(Mart iodide Preodeot,Sencecy.Tra werer,ViesPneeideet,Maerstr asrl Sbrnisoldrsibleinber with at kart 10%2 Name Mk sib Home Address&TekphaoeNmlmr Work Telephone Date of Biel I Number , • n1 OpIFR '-aw I6 5. j� Moose {'ASS, 907- 285 71/D' Q 1\1 dWWE So A�1R 3479 I NOTE:If you weed adildoaat owe,please attars a aspirate skeet_ New Application Page 2 of 3 ,A,,, 1(4) • , Alcoholic Beverage Control Board New Liquor License 400 Viking Drive (907)269-0350 Anchorage,AK 99501 Fax:(907)334-2285 / httpi/commerce.alaskagov/dnnlabc/Home.aspx SECTION E-OWNERSHIP INFORMATION-SOLE PROPRIETORSHIP(INDIVIDUAL OWNER&SPOUSE) Individual I3censers/Affillates(The ABC Board defines an"Affiliate"as the spouse or significant other of a licensee. Each Affiliate must be listed.) Name: f7-fJ L, 6Prt NE,__ Applicant fir Name: Applicant❑ Address: Box 3.76 9hO7$t= Qe5S ❑ Address: A ❑ Home Phone: </b 7 Z 8 3(''8 e°`° ' ' Date of Birth: Home Phone: Work Phone: ?0�1 22-11 "17/0 Work Phone: Name: ?u y 1 1�' A Q Di--fv - Applicant Name: Applicant 0 Address: 50x, 1767 AI of Se FA-55 me ° Address: Affibate 13 Home Phone: CI 0 7 Z g 8 5678 Home Phone: Date of Birth: Work Phone: ?0 7 2-2 Lt 1j 71 D , . , 1 .. Work Phone: Dedaradon • I declare under penalty of perjury that I have examined this application,including the accompanying schedules and statements,and to the best of my knowledge and belief it is true,correct and complete,and this application is not in violation of any security interest or other contracted obligations. • I hereby certify that there have been no changes in officers or stockholders that have not been reported to the Alcoholic Beverage Control Board. The undersigned certifies on behalf of the organized entity,it is understood that a misrepresentation of fact is cause for rejection of this application or revocation of any license issued. • I further certify that I have read and am fenniiar with Title 4 of the Alaska statutes and its regulations,and that in accordance with AS 04.11.450, no person other than the licensee(s)has any direct or indirect financial interest in the licensed business. • I agree to provide all information required by the Alcoholic Beverage Control Board in support of this application. spaar of Lt a Simeon of Ltaasee(s) Signature 1/ll A/.'// _/l/,U S -__-rat.. !..AA Signore Name do T' (Please ) Name d:Tide(Phase Print) -- -,-- --;,..)14.,..„ C.....),) 1AA/f...).„ csf11.4./7:1) Subscribed and sworn to before me this S and swam to before me this ZZ day of _ ll'e ,Zc -1 r t t r,l 1-it, 2-Z day s Li & LOS C/, P u b f i c in and for rte of D/A f r' `a, Noon Public in acct forthe -1IG43/G G■. �b.� r) 's JL, � � � /4 40 �` r l/ � /� / 4 Cry 1 ". My commaoron cxprrea, _`L? 'L.' j+, r1 r�- G'_ My coon expires: 2-0/ ' S L r l' rr '''' ✓ «`ti l J x /-- t; r \J .,,' New Application Page 3 of 3 ,/3/14 91 STATE OF ALASKA ALCOHOLIC BEVERAGE CONTROL BOARD APPLICATION FOR RESTAURANT DESIGNATION PERMIT AS 04.16.049&3 AAC 304.715—794 The granting of this permit allows access of persons under 21 years of age to designated licensed premises for purposes of dining, and persons between the ages of 16—20 for employment. If for employment,please indicate in detail what the employment duties will be in question#3. License Number: 6 4 , f ` ' (-160 6 Type: JY&) Ft-NT- ' ' (NC 12L�E This application is for designation of premises where: (Please check the appropriate items below) 1 X Bona fide restaurant pursuant to 3 AAC 304 305&3 MC 304 715-794. 2 x1 Persons 16—20 years of age may dine unaccompanied 3 Persons under 16 may dine accompanied by a person 21 years of age or older 4 Persons between 16—20 years of age may be employed. '(See note below) Licensee's Name: J .-.. To D J Q b f` p r Name of Business: iJ P''..1 //S.'. , .Cf 1 t�'�/!_ �1.C ,. /,�-,p_�_ Business Address: ITa I RA—( f—Y I iY . City: �7 E.K r ` Z_b 1 Hours of operation 10 A1 to /4 FP/ Telephone Number: ZZi-i±Zvi 1 o...._ _.____ 2. Have police been called to your premises for any reason? [ ]Yes )4 No (If you answered yes, please explain below). I' 3 `CUiIES 0'ernp+oyrm ni gI"r g4 5_ r . d 6D_ _ ‘,,it C- T .__Y 15_111 /VS ti-tw-C, 4 video games available to the public on your premises? [ j Yes ?No 5 Do you provide live entertainment, such as live music,pool tables, karaoke,dancing,sports or pin-ball? [ ]Yes $No 6 How is food served? [ ]Table Service [ ]Buffett Service p Counter Service [ ]Other 7 Is an owner,manager or supervisor 21 years of age or older always present during business hours? Xj Yes [ ] No ""A MENU AND DETAILED PREMISES DIAGRAM MUST ACCOMPANY THIS APPLICATION•" 'Employees 16 and 17 years of age must have a valid work permit and a letter maintained in your files from a parent or guardian authorizing employment at your establishment. • '"Please attach additional sheets of paper if more space is needed to describe food service,entertainment,etc. _ li --^, III 1.1 / Licensee Signature � Local Governing Body Approval Subscribed and sworn to before me this NII>day of CC(y6 36'Q 00.f,--------■- Date Notary Public in and for AlaAsk/a y� :'.iy r :,rtl!"1iS,IGrr e,C I k7,',5 4)1h1 14.11,41'_..el lo _. -.._. ..... �1 num, .. 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(..) e- L) 06. 0 A cc :::' In ,='.' b0 11 4 T. y.r.... *TN'�• $ L/-1 � � , PROCCAMXfl O N WHEREAS, Seward's citizev&,s recogvttize that a special vibravt,cu exists throughout the etAti,re covu.vu.uvt,itj whevt, its ivtdividual residevtts coLLectiveL "go the extra voile°through persovtal effort, voLuvt,teerisvu avid service; avt,d WHEREAS, ou.r covu.vu.yvA,it evtcourages its citizevLs to maxi,mi,ze their persovt,aL covttributiovt, to the cowt.wt.uv>,itt,/_ givivtg of thewt.seLves whoLeheartedl avid with total effort, covuwt.itvvt.evLt o covLvictiovL to their iv,dividual awtbitiovts, favuilt�, frietAds av c cowt.wt.uvt,it ; avLd `fir WH -EREAS, Seward residevtts choose to shivt,e a light ow avt,d celebrate wt,di,viduaLs atA,d orgavti,zatiotA,s who "go the extra wt,iLe" ivt, order to vwal2e a d%f ferevt,ce avLd lift up feLLow vvt.ev&bers of their cowtwt.uvt,it ; awd WH-EREAS, we nal2vt,owLedge the wt.issiow of the Extra Mile America Foukdatiovl,to create 500 "Extra Mile" cities avt,d states IAA, America Lw 2014. NOW, 11H-ERE1oRE, I,jeavk, P,ardarsovt,, Major of Seward, ALas12a, do hereby proclaim, November 1, 2014 to be Extra Mile Da` avot urge each ivt,dividuaL IAA- DRY covv,wt,uvt,it to talze tiwt,e ovL this dad to wot ovLL` "go the extra vvt.LLe" ivy his or her owo, Life, but to also acl2vt,owLedge those arouvt,d us who are iv,,spiratiovt,aL ivt their efforts avt,d cove mi,tvwevtt to vval2e their orgavt,izatiovt,s, fawtLLLes avid cowtwtuvLit` a better pLace ivy, which to Live avtid wor12. Dated this 27A°1 of October, 2014 TI-t air( OF SEWARD, ALASKA '411ine 11-14A1) 1&_dalba914-) Jeawgardarsow, Mauor October 2014 October 2014 November 2014 SuMo TuWe Th Fr Sa SuMo TuWe Th Fr Sa 1 2 3 4 1 5 6 7 8 9 10 11 2 3 4 5 6 7 8 12 13 14 15 16 17 18 9 10 11 12 13 14 15 19 20 21 22 23 24 25 16 17 18 19 20 21 22 26 27 28 29 30 31 23 24 25 26 27 28 29 30 Monday Tuesday Wednesday Thursday Friday Sep 29 30 Oct 1 2 3 12:00pm PACAB Mtg m fi 0 orn N a N 6 7 8 9 10 5:30pm CC WS 7:00pm P&Z Mtg kip 0 0 13 14 15 16 17 6:00pm CC WS 12:00pm Seward Rec Cc Holiday;Alaska Day 7:00pm CC Mtg 6:30pm HP Mtg 10:00pm HP WS;Immec m 0 20 21 22 123 24 6:00pm P&Z WS 7:00pm Seward Fish ar N N O N tJJ 0 27 '`�.^� 28 29 30 31 5:30pm CC WS; Altern\°f� 7:00pm CC Mtg / r` N O Nanci Richey 1 10/22/2014 9:49 AM t b ■ November 2 014 November 2014 December 2014 SuMo TuWe Th Fr Sa SuMo TuWe Th Fr Sa 1 1 2 3 4 5 6 ‘141r 2 3 4 5 6 7 8 7 8 9 10 11 12 13 9 10 11 12 13 14 15 14 15 16 17 18 19 20 16 17 18 19 20 21 22 21 22 23 24 25 26 27 23 24 25 26 27 28 29 28 29 30 31 30 Monday Tuesday Wednesday Thursday Friday Nov3 4 5 6 7 7:00pm PBtZ Mtg 12:00pm PACAB Mtg 6:00pm HP WS n m 0 z 11 12 13 14 7:00pm CC Mtg ; Veteran's Day Observe; 0 17 18 19 20 21 6:00pm P&Z WS 12:00pm PACAB Work S 6:30pm HP Mtg N N O z 24 25 126 27 128 7:00pm CC Mtg Thanksgiving Holiday; Thanksgiving Holiday; 00 N N N 0 Nanci Richey `1 10/22/2014 9:49 AM 1 c� December 2014 January 2015 December 2014 SuMo TuWe Th Fr Sa SuMo TuWe Th Fr Sa 1 2 3 4 5 6 1 2 3 7 8 9 10 11 12 13 4 5 6 7 8 910 14 15 16 17 18 19 20 11 12 13 14 15 16 17 23 24 `*tamild 21 22 23 24 25 26 27 18 19 207 21 22 30 31 28 29 30 31 Monda y Tuesday Wednesday Thursday Friday Dec 1 2 I 3 14 5 6:00pm PBtZ and Flooc 12:00pm PACAB Mtg 7:00pm P&Z WS u� U a 9 10 11 12 8 7:00pm CC Mtg N CO U a' a 15 116 117 118 119 12:00pm PACAB Work S 6:30pm HP Mtg o V, U a 23 24 25 26 D 7:00pm CC Mtg 12:00pm Christmas Obs ,Merry Christmas;Ofiic' N N N U a a 29 30 31 Jan 1,15 2 N cn a, 10/22/2014 9:49 AM Nanci Richey ,�R,[�