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HomeMy WebLinkAboutRES2025-097 Alaska Sealife Center Agreement & LeaseSponsored by: Sorensen Public Hearing: October 13, 2025 CITY OF SEWARD, ALASKA RESOLUTION 2025-097 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, AUTHORIZING AMENDMENT NO. 4 TO COOPERATIVE AGREEMENT AND AN AMENDMENT TO THE THIRD AMENDED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, WATERFRONT TRACTS AND THE LEASE, OPERATION AND MAINTENANCE OF THE ALASKA SEALIFE CENTER WHEREAS, the City, Seward Association for the Advancement of Marine Science (SAAMS), and the Alaska Department of Fish and Game (ADFG) have been working together to amend the Cooperative Agreement and the Lease Agreement to ensure that its provisions reflect the current status and relationships between the entities; and WHEREAS, the applicable agreements governing construction, operation, and management of facilities owned by the City and operated by the SAAMS initially required the Alaska Department of Fish and Game and Exxon Valdez Oil Spill (EVOS) Trustee Council to oversee the City of Seward and SAAMS in various ways to ensure that the facilities were constructed and operated in the manner intended by EVOS; and WHEREAS, on September 8, 2023 EVOS, acknowledging the successful construction and operation of the facilities for decades, adopted a resolution allowing the parties to revise the agreements governing the operation and management of the facilities to remove the need for EVOS oversight or approval; and WHEREAS, the City, SAAMS, and ADFG agree that operations, management, and ownership terms of the facility should be between the City and SAAMS; and WHEREAS, under the current agreements, the City's ability to determine that the facilities are not capable of generating revenues to cover operating expenses is still subject to verification by an independent financial consultant selected or approved by ADFG; and WHEREAS, under the current agreements, if SAAMS and the City elect not to operate the facility, ADFG has one year to enter and assume operations of the facility; and WHEREAS, all three parties recognize that both of these provisions unnecessarily restrict the City's ownership rights given the decades of successful ownership and management by the City and SAAMS; and WHEREAS, it is in the best interest of the City to remove ADFG's oversight from the agreement; and WHEREAS, amending the agreements to remove ADFG as a party and to remove its CITY OF SEWARD, ALASKA RESOLUTION 2025-097 Page 2 of 2 oversight and approval role from the agreements in no way reduces or increases the rights or obligations of the City or SAAMS to one another; and WHEREAS, ADFG agrees to the amendment to the Cooperative Agreement removing it from the oversight role initially assigned to it. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, that: Section 1. The City Manager is authorized to execute Amendment No. 4 to the Cooperative agreement in a form substantially similar to the attached and is authorized to execute the amendment to the Third Amended and Restated Agreement for Lease of Tract 2A, Waterfront Tracts and the Lease, Operation and Maintenance of the Alaska Sealife Center between SAAMS and the City in a form substantially similar the attached document. Section 2. This resolution shall take effect immediately. PASSED AND APPROVED by the City Council of the City of Seward, Alaska, this 13th day of October 2025. THE CITY OF SEWARD, ALASKA frinoc Q.u. v-e- Sue McClure, Mayor AYES: Crites, Wells, Barnwell, Osenga, McClure NOES: None ABSENT: Warner, Finch ABSTAIN: None Kris Peck City Clerk 1 City Council Agenda Statement Meeting Date: October 13, 2025 To: City Council Through: Kat Sorensen, City Manager Subject: Resolution 2025-097: Authorizing Amendment No. 4 to Cooperative Agreement and an Amendment to the Third Amended and Restated Agreement for Lease of Tract 2a, Waterfront Tracts and the Lease, Operation and Maintenance of the Alaska Sealife Center Background and justification: The City of Seward, the Seward Association for the Advancement of Marine Science (SAAMS), and the Alaska Department of Fish and Game (ADFG) have been working together to amend the Cooperative Agreement and the Lease Agreement to ensure that its provisions reflect the current status and relationships between the entities. The applicable agreements governing construction, operation, and management of facilities owned by the City and operated by the SAAMS initially required the Alaska Department of Fish and Game and Exxon Valdez Oil Spill Trustee EVOS Trustee Council (EVOS) to oversee the City of Seward and SAAMS in various ways to ensure that the facilities were constructed and operated in the manner intended by EVOS. EVOS, acknowledging the successful construction and operation of the facilities for decades, adopted a resolution allowing the parties to revise the agreements governing the operation and management of the facilities to remove the need for EVOS oversight or approval. The City, SAAMS, and ADFG agree that operations, management, and ownership terms of the facility should be between the City and SAAMS. Under the current agreements, the City's ability to determine that the facilities cannot generate revenues to cover operating expenses is still subject to verification by an independent financial consultant selected or approved by ADFG, and if SAAMS and the City elect not to operate the facility, ADFG has one year to enter and assume operations of the facility. All three parties recognize that both of these provisions unnecessarily restrict the City's ownership rights given the decades of successful ownership and management by the City and SAAMS. Amending the agreements to remove ADFG as a party, and to remove its oversight and approval role from the agreements, in no way reduces or increases the rights or obligations of the City or SAAMS to one another. ADFG agrees to the amendment to the Cooperative Agreement, removing it from the oversight role initially assigned to it. Comprehensive and Strategic Plan Consistency Information This legislation is consistent with (citation listed): Comprehensive Plan: Strategic Plan: Other: Total amount of funds listed in this legislation: This legislation (✓): Creates revenue in the amount of: Creates expenditure in amount of: Creates a savings in the amount of: Has no fiscal impact Funds are (✓): Budgeted Line item(s): Not budgeted Not applicable Affected Fund (✓): General Boat Harbor Motor Pool Available Fund Balance Yes SMIC Parking Other Electric Water $ Wastewater Healthcare Note: amounts are unaudited Finance Director Signature: Attorney Signature: /s/ Sam Severin Not applicable Comments: Administration Recommendation X Adopt Resolution Other: AMENDMENT TO LEASE - October 2025 Page 1 of 4 AMENDMENT to the THIRD AMENDMED AND RESTATED AGREEMENT FOR LEASE OF TRACT 2A, WATERFRONT TRACTS AND THE LEASE, OPERATION AND MAINTENANCE OF THE ALASKA SEALIFE CENTER between the SEWARD ASSOCIATION FOR THE ADVANCEMENT OF MARINE SCIENCE d/b/a ALASKA SEALIFE CENTER and the CITY OF SEWARD, ALASKA THIS AMENDMENT ("Amendment") is made and entered into between the Seward Association for the Advancement of Marine Science (hereinafter referred to as "SAAMS") and the City of Seward, PO Box 167, Seward, Alaska 99664 (hereinafter referred to as "City"), collectively referred to as the "Parties." The City and SAAMS executed the Third Amended and Restated Agreement for Lease of Tract 2A Waterfront Tracts and the Lease, Operation and Maintenance of the Alaska Sealife Center ("Lease") on March 28, 2017. NOW THEREFORE, the Parties agree as follows: I. AUTHORITY The Parties are entering into this Amendment under the authority granted in Section 10.11 of the Lease. II. DEFINITIONS The following shall, for all purposes of this Amendment, have the following meanings: AMENDMENT TO LEASE AMENDMENT TO LEASE - October 2025 Page 2 of 4 (a) "ADF&G" shall mean the State of Alaska, Department of Fish and Game. (b) "Amendment" shall mean this Amendment to the Lease. (c) General Definitions. All other capitalized terms in this Amendment shall have the same meaning as set forth in the Lease. III. PURPOSE OF AMENDMENT The purpose of this Amendment is to remove the role, future obligations, rights and responsibilities of ADF&G from the Lease. IV. COVENANTS SAAMS and City do hereby covenant and agree as follows: A. ADF&G is removed as a party to the Lease. B. The Lease is amended as follows. Removed language is marked with strikethrough and added language marked as bold. 1. Section 1.1.18 "Indemnified Parties" is amended to remove reference to ADF&G. 2. Section 3.13.4 Payment of Award is amended: The Award shall be payable first, to ADF&G, to the extent rcquircd under thc Cooperative Agreement, and second, to SAAMS; except that the City shall receive from the Award the amount attributable to the value of the Site without Improvements. 3. Section 5.5 SAAMS Election Not to Operate the Improvements is amended: SAAMS shall notify the City if SAAMS elects not to operate the Improvements, either because the Improvements have reached the end of their practical life as defined in Subsection 3.1.1, or if for any other reason permitted under this Agreement, SAAMS elects not to operate the Improvements. The City shall provide the same notice to ADF&G under thc Cooperative Agreement within thirty (30) business days after receiving the notice from SAAMS. If the City Improvements as defined in Subsection 1.1.25. SAAMS shall maintain an amount equal to the AMENDMENT TO LEASE AMENDMENT TO LEASE - October 2025 Page 3 of 4 Termination Fund Requirement in a special fund dedicated to pay the cost of performing this obligation. SAAMS may access up to $700,000 annually from the Termination Fund between October 1 and September 29, but shall provide evidence to the City that on September 30 that this fund is fully replenished. Nothing in this subsection is intended to limit SAAMS' responsibility if the costs exceed the amount in the special fund. Any amount remaining in the fund at the end of the one year period shall be released to the party that has assumed the operation of the I mprovements. 4. Section 6.1 is amended to read: For so long as the Cooperative Agreement requires the City to insure the Site or Improvements, the minimum insurance for the Site and Improvements shall be that required of the City under the Cooperative Agreement; provided that such insurance requirements may be modified as provided in this Section 6.1. If one or more of the required insurance coverages are not available under reasonable terms and conditions, SAAMS shall, under the guidance and direction of the State of Alaska, Division of Risk Management, use its best efforts to obtain reasonably equivalent coverage acceptable to ADF&G the City. If, after utilizing its best efforts, SAAMS is unable to obtain adequate insurance at a cost effective rate as reasonably determined by SAAMS, SAAMS may request a waiver of the relevant insurance requirement. The request shall outline the steps taken by SAAMS to obtain such insurance and shall disclose quotations received for coverage. Upon the written determination of the State of Alaska, Division of Risk Management that a reasonable basis exists to believe that a waivcr of such insurance will not materially affect the State's risk with regard to the Improvements or any activities in, on, or around the Improvements, and approval of the requested waivcr by ADF&G, the City will approve the requested waiver. 5. Section 6.3 is amended to read: All insurance policies shall provide for thirty (30) days' notice to the City and ADF&G of cancellation and/or material change in policy terms. 6. Section 6.4 is amended to read: The City and Indemnified Parties shall be named as additional insureds under all insurance policies maintained by SAAMS as required under Section 6.1, or SAAMS shall obtain an appropriate waiver of subrogation in favor of the City and the Indemnified Parties with respect to all insurance policies to effect the same purpose. The City, shall be named under casualty insurance required under Section 6.1 as loss payees on any property loss settlement. The City shall be named as an additional insured under all policies maintained by SAAMS as required under Section 6.2, or SAAMS shall obtain an appropriate waiver of subrogation in favor of the City with respect to all insurance policies to effect the same purpose. The City shall be named under casualty insurance required under Section 6.2 as loss payee on any property loss settlement. AMENDMENT TO LEASE AMENDMENT TO LEASE - October 2025 Page 4 of 4 C. Except as set forth in this Amendment, all of the provisions of the Lease shall remain unchanged and in full force and effect. EFFECTIVE DATE This Amendment shall be effective on the date the last signature to the Amendment is certified. SAAMS CITY OF SEWARD By: By: Its: It: Date Date AMENDMENT TO LEASE AMENDMENT NO. 4 TO THE COOPERATIVE AGREEMENT 95-045 Page 1 of 4 AMENDMENT NO. 4 to the COOPERATIVE AGREEMENT between the State of Alaska Department of Fish and Game and the City of Seward for the construction, operation and maintenance of research infrastructure improvement at the Alaska SeaLife Center in Seward, Alaska THIS AMENDMENT NO. 4 ("Amendment") is made and entered into between the State of Alaska, Department of Fish and Game, PO Box 25526, Juneau, Alaska 99802-5526 (hereinafter referred to as "ADF&G"), and the City of Seward, PO Box 167, Seward, Alaska 99664 (hereinafter referred to as "City"), collectively referred to as the "Parties." The Parties executed a Cooperative Agreement between ADF&G and City for the Construction, Operation, and Maintenance of Research Infrastructure Improvements at the Alaska SeaLife Center in Seward, Alaska, dated April 28, 1995, which was recorded in Book 76, Page 788, of the records of the Seward Recording District, Third Judicial District, State of Alaska, as amended by Amendment No. 1 providing for the FISH PASS, revision of the PAYMENT PROCEDURES and revision of the DETAILED BUDGET, as amended by Amendment No. 2 providing for purchase of research equipment and restoration program exhibitry, and as amended by Amendment No. 3 eliminating the requirement that the United States, the Trustee Council, and the Executive Director are named as additional loss payees (hereinafter with amendments referred to as "Cooperative Agreement"), NOW, THEREFORE, the Parties agree as follows: I. AUTHORITY The Authority of ADF&G to enter into this Amendment to the Cooperative Agreement is AS 16.05.050(13), AS 36.30.850(c), and AS 37.14.400 et seq. The Parties are entering into this Amendment pursuant to paragraph III.RR of the Cooperative Agreement. AMENDMENT NO. 4 TO THE COOPERATIVE AGREEMENT 95-045 Page 2 of 4 II. DEFINITIONS The following shall, for all purposes of this Amendment, have the following meanings: A. "Amended Cooperative Agreement" shall mean the Cooperative Agreement as amended by this Amendment. B. "Amendment" shall mean this Amendment No. 4 to the Cooperative Agreement. C. General Definitions. All other capitalized terms in this Amendment shall have the same meaning as set forth in the Cooperative Agreement. III. PURPOSE OF AMENDMENT The purpose of this Amendment is to remove the role, future obligations, rights and responsibilities of ADF&G from the Cooperative Agreement. IV. COVENANTS ADF&G and City do hereby covenant and agree as follows: A. The Cooperative Agreement is amended as follows. Removed language is marked with strikethrough and added language marked as underlined. 1. Section III(U) shall be amended as follows: City ownership. The City shall own, operate, and maintain the Project for the practical life of the Facility. 1. Subject to (2) of this section, the practical life of the Facility shall end upon the occurrence of both of the following (i) the City makes a reasonable determination, as verified by an independent financial eensusele , that the Facility is not capable of generating revenues sufficient to cover the operating expenses and debt service of the Facility, plus fund sufficient reserves for repairs and replacements in the Facility; and (ii) while being operated in accordance with any recommendation from the independent financial consultant and in accordance with terms and conditions of the Agreement during the two-year period following the City's determination, the Facility does not generate revenues sufficient to cover the operating expenses and debt service of the Facility. Plus fund sufficient reserves for repairs and replacements in the Facility. 2. In no event shall the City be required to operate and maintain the Facility after the earlier of (i) the date 50 years from the date of AMENDMENT NO. 4 TO THE COOPERATIVE AGREEMENT 95-045 Page 3 of 4 Final Acceptance, and (ii) any event causing damage to, or destruction of, the Facility, where the cost of repairing or restoring the Facility, net of any available reserves and insurance proceeds not reduced for applicable deductibles and coinsurance, exceeds ten percent of the replacement cost of the Facility. 2. Section III(V) shall be removed in its entirety. 3. Section III(X) shall be amended as follows: Remedies Upon Breach by City. Whenever an event of default by the City shall have occurred, and any applicable period for giving notice and any opportunity to cure shall have expired, ADF&G shall have the following rights and remedies in addition to any rights and remedies that may be available by law: 1. Declare this Agreement terminated. 2. Recover all monies previously paid to the City under this Agreement that were n 3. ADF&G shall have the op ' er-ation of the Alaska Sc life Center; ins ragraph ul V eD r shall overnice thi tigay-- ten notice to the City any- ired. 4 2. Seek specific performance of any term or provision of this Agreement. 4. Section III(Z) shall be removed in its entirety. 5. Section III(AA) shall be amended as follows: Indemnification. The City shall indemnify the State and the EVOS Trustee Council according to the provisions described in Appendix 8. Any references in Appendix 8 to ADF&G taking over the facility are rendered meaningless as they are inconsistent with the intent of this Amendment. B. Except as set forth in this Amendment, all the provisions of the Cooperative Agreement shall remain unchanged and in full force and effect. V. EFFECTIVE DATE This Amendment shall be effective on the date the last signature to the Amendment is certified. STATE OF ALASKA THIRD JUDICIAL DISTRICT AMENDMENT NO. 4 TO THE COOPERATIVE AGREEMENT 95-045 Page 4 of 4 STATE OF ALASKA DEPARTMENT OF FISH AND GAME By: Doug Vin Signed: Date: ss. Subscribed and sworn to before me on 1(1 Z� , in %/►C kOi` (date) (town) (seal) STATE OF ALASKA THIRD JUDICIAL DISTRICT Notary Notary . • and in the State of Alask My commission expires tv Alaska. CITY OF SEWARD, ALASKA By: Kat Sor-nsgr , anager Signed: Date: d i.��t. • _ ss. Subscribed and sworn to before me on 10/ 1 (05 , in sP (c)a r'g% Alaska. (date) (town) KRISTIN WISE Notary Public State of Alaska 2028 My Commission Expires July (seal) Notary : Notary fo a din the State of Alaska My commission expires Lu)v [� �O