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HomeMy WebLinkAboutRes1989-041 . . . sponsored by: Rovle CITY OF SEWARD, ALASKA RESOLUTION NO. 89-041 RESOLUTION OF THE CITY COUNCIL OF TH CITY OF SEWARD, ALASKA APPROVING A MAINTEN CE AND GRAVEL EXTRACTION AGREEMENT FOR THE FOU H OF JULY CREEK WITH AFOGNAK LOGGING WHEREAS, by Resol tion 88-051, the City council determined that it is in the public 'nterest to provide for removal of debris, rock, tree stumps, grav 1 and other debris that may block or deflect the channel of th Fourth of July Creek and endanger the dike system constructed by he city in 1983. To do so an agreement has been negotiated with AF NAK LOGGING ("AFOGNAK") and it is the desire of the City Council 0 set forth in this Resolution the reasons for its approval of t at agreement; and WHEREAS, the Fourth of Ju y Creek is subjected to periodic flooding and the stream channel c n be blocked by debris or altered by the deposit of gravel and othe materials; and WHEREAS, by Request for Propos ls issued in January 1988, the city sought proposals from intereste parties for the provision of channel maintenance and material rem al services from the Fourth of July Creek; and WHEREAS, subsequent to one proposal was submitted, of time to respond, only FOGNAK; and WHEREAS, as a result of difficulties by the city l.n obtaining title to the property, the city was unable to commit to as contemplated in the original Request for P proposal submitted; and encountered ourth of July Creek long-term agreement posals and the only WHEREAS, in order to assure maintenance wor during the 1988 season the city agreed with AFOGNAK to an int im maintenance agreement and the City Administration was direct d to negotiate with AFOGNAK for a long-term agreement after titl problems had been resolved; and WHEREAS, title problems have been resolved and he parties have been able to negotiate a long-term agreement; and WHEREAS, all potential suppliers of maintenance a d flood control services had a full opportunity to propose to the c'ty last year; and WHEREAS, channel maintenance and flood control work wi 1 be accomplished at no cost to the city under the proposed agreement, resulting in a direct savings to the city; and -1- '=f-~ J ;;t:eJ p~ us/;;)~/('1 . . . CITY OF SEWARD, ALASKA RESOLUTION NO. 89-041 WHEREAS, the cost to the city in performing the channel maintenance itself would exceed the potential lost revenues from the lack of royalty payments on the first 50,000 cubic yards removed as provided in the agreement; and WHEREAS, under the agreement, if more gravel than that expected to be required for maintenance is removed (50,000 cubic yards), the city will receive a royalty on the gravel at a rate that is reasonable and competitive; and WHEREAS, an appraisal of the value of the property would not be in the public interest; and WHEREAS, AFOGNAK, with the encouragement and cooperation of the city, is attempting to develop a commercially viable market for the export of gravel from Seward; and WHEREAS, the development of such a market would result in the development of a beneficial new industry in Seward and would provide employment, investment opportunities and increased utilization of public port facilities; and WHEREAS, AFOGNAK cannot reasonably be expected to be successful in developing a market for gravel export without an assured long-term supply; and WHEREAS, it is in the public interest to encourage and assist the development of that new industry and the city is willing to negotiate in good faith with AFOGNAK amendments to the agreement as may be prudent or necessary in light of any future gravel export opportunities. 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 the Maintenance and Gravel Extraction Agreement for the Fourth of July Creek, attached as an exhibit to this resolution. section 2. The City Council finds for the reasons stated in the WHEREAS Clauses of this resolution that: a) the public interest would be served by the agreement, and b) an appraisal of the property would not be in the public interest, and c) the public interest is best served by not requiring full compliance with the provisions of Title 6.05 of the Seward City Code. -2- . . . CITY OF SEWARD, ALASKA RESOLUTION NO. 89-041 section 3. This resolution shall be effective thirty (30) days after posting in accordance with the Ordinances of the city of Seward. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF SEWARD, ALASKA, this 22nd day of May, 1989. CITY OF SEWARD, ALASKA By: Harry E. Gieseler, Mayor AYES: NOES: ABSENT: ABSTAIN: O'BRIEN GIESELER, HILTON, MEEHAN, SIMUTIS DUNHAM NOLL ATTEST: APPROVED AS TO FORM: Perkins Coie Attorneys for City of Seward v~~.~ Patricia J. Jones City Clerk Fred B. Arvidson City Attorney (City Seal) -3- . . . MAINTENANCE AND GRAVEL EXTRACTION AGREEMENT FOURTH OF JULY CREEK, SEWARD, ALASKA THIS AGREEMENT made and entered into this day of -, 1989, between the CITY OF SEWARD, ALASKA (CITY), and AFOGNAK LOGGING (CONTRACTOR), an Alaskan corporation and licensed contractor established in the City of Seward. WHEREAS, for the reasons set forth in Resolution 89-____ the City Council of the City of Seward has determined that it is in the public interest to award a maintenance agreement for the removal of debris, rock, tree stumps, gravel and other debris that may block or deflect the channel of the Fourth of July Creek and endanger the dike system constructed by CITY in 1983; WHEREAS, only one original bid proposal was submitted to the City of Seward, and the City of Seward recognized in Resolution 88-051, dated May 9, 1988, that CONTRACTOR was willing to enter into an interim maintenance agreement in 1988 only upon the assurance of CITY that it would, in good faith, seek to conclude a long-term agreement for the removal of gravel and storage of gravel on city lands near Fourth of July Creek; and WHEREAS, the City Council authorized and instructed the city administration to enter into negotiations with CONTRACTOR for a longer term agreement when the Kenai Borough transferred title to the land underlying the Fourth of July Creek to CITY; NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS: AFOGNAK Maintenance Agreement May, 1989 Page 1 . . . 1. Contracting Officer. The Contracting Officer and person authorized by the City of Seward to administer this contract is Everett Paul Diener, Manager of Engineering and Utilities. 2. The Contract Documents consist of Contract Documents. this Agreement, General Conditions attached as Exhibit A, a Flood Prevention/Channel Maintenance Plan to be prepared by contractor and submitted to the contracting officer within thirty (30) days of the date of this agreement. The Flood Prevention/ Channel Maintenance Plan shall include the information specified in paragraph 12 of this agreement. The Contracting Officer shall have a period of ten (10) days from the delivery to the Contracting Officer of that Plan to disapprove the Plan in writing or to require reasonable changes thereto. If the Contracting Officer has not disapproved or made required changes to the Plan within ten (10) days from the delivery of the Plan to the Contracting Officer, the Plan shall be deemed accepted, and may be modified thereafter only on the mutual agreement of both parties. The approved Flood Prevention/Channel Maintenance Plan shall be attached hereto as Exhibi t B. Both the General Conditions and the Flood Prevention/Channel Maintenance Plan are incorporated as part of this Agreement. 3. Scooe of Work. a) The scope of work is more particularly described in the Flood prevention/Channel Maintenance Plan and includes maintenance for flood control in the channel of the Fourth of July Creek including removal of rock, gravel, silt, sand, tree stumps and other debris (altogether, the AFOGNAK Maintenance Agreement May, 1989 Page 2 . . . "spoil") necessary to clear the channel and to allow the flow of the stream to return to the south channel. The work includes removal annually, not later than September 30 of each year ("the contract year"), of a minimum of 50,000 cubic yards of spoil that fills the channel in those portions of Fourth of July Creek to be specified by CITY each year (the "river maintenance zone"). CONTRACTOR will be responsible for restoring the channel along the southeast side of the river bed at such points in the river maintenance zone as shall be designated by CITY. No excavation or removal of material will be permitted within 100 feet of the existing dike except with specific written permission of the contracting officer. b) As of the effective date of this agreement, CONTRACTOR has removed cubic yards of spoil since January 1, 1989. CONTRACTOR shall be credited with removal of that amount in the first contract year for all purposes under this agreement. 4. Contractor Compensation. Compensation to CONTRACTOR for the work to be performed under the Scope of Work identified in the Flood prevention/Channel Maintenance Plan shall be limited to the gravel and other usable materials contained in the first 50,000 cubic yards of spoil removed from the river maintenance zone. Except as may be allowed under paragraph 9, CITY will not pay CONTRACTOR any amount whatsoever for emergency or other flood control work performed at the site. CONTRACTOR understands that the work includes the removal of debris, silt, AFOGNAK Maintenance Agreement May, 1989 Page 3 . . . sand, and other materials that have no commercial value, but notwithstanding this fact, CONTRACTOR will not be permitted to claim reimbursement for, or in any other way charge for, the removal and disposal of those materials. CITY makes no representations as to the relative percentages of different types of materials, and the risk that there is not sufficient gravel for commercial development is solely on CONTRACTOR. 5. CITY's Purchase of Gravel. CITY may purchase gravel from CONTRACTOR at CITY's sole discretion, either by direct purchase at CONTRACTOR's normal price, or by competitive bid or negotiated price. This contract shall not be deemed to give CONTRACTOR any special right or ability to sell gravel to CITY. 6. Ouality of Work. CONTRACTOR agrees that all work and labor shall be done and performed in the best and most workmanlike manner and in strict conformity with the General Conditions and the Flood Prevention/Channel Maintenance Plan. All work shall be done to the satisfaction of CITY and subject to inspection at all times and further subject to approvals required by any regulatory agencies of the local, state or federal governments. 7. Permits. CONTRACTOR shall obtain all necessary permits, rights-of-entry, or other consents from all governmental agencies. Copies of all such permits shall be provided to CITY prior to CONTRACTOR commencing work under this agreement. The risk of a failure to obtain any required permits shall be solely on CONTRACTOR although CITY agrees to, in good faith, assist CONTRACTOR in obtaining any required permits. AFOGNAK Maintenance Agreement May, 1989 Page 4 . . . 8. In conjunction with the execution of this Lease. agreement CONTRACTOR and CITY may enter into a lease agreement whereby CONTRACTOR may acquire from CITY a lease of land in the Fourth of July Creek area for CONTRACTOR's use as a storage area for gravel removed under the terms of this agreement. That lease and this agreement are severable, and CONTRACTOR has not obtained any right to that lease by reason of this agreement. 9. Additional Flood Control Work. If CITY determines a) that for flood control purposes the removal of more than 50,000 cubic yards of spoil from Fourth of July Creek is required in any contract year, CONTRACTOR may elect to remove the additional spoil in the time period specified by CITY and retain the gravel as its only compensation for the additional work. b) If, for whatever reason, CONTRACTOR does not elect to remove the additional spoil under the terms of Subparagraph a) of this Section, CITY may either remove the spoil itself or contract with another contractor (including CONTRACTOR) for the removal of the spoil. In that case, any spoil removed shall belong to CITY and CONTRACTOR shall be entitled to no compensation for the spoil under this agreement. c) If for whatever reason CONTRACTOR does not elect to do additional work under the terms of subparagraph a) of this section, then nothing in this agreement shall preclude CITY or others acting on CITY's behalf from entering into the river maintenance zone and removing such spoil as may be necessary in CITY's discretion for flood control. CONTRACTOR shall not be AFOGNAK Maintenance Agreement May, 1989 Page 5 . . . entitled to any compensation for any spoil removed by CITY or others acting on CITY's behalf for flood control purposes. d) No claim for additional work or materials will be allowed by CITY, nor shall CONTRACTOR do any work or furnish any material not covered by this contract unless CONTRACTOR has first been directed to do so in writing by the Contracting Officer. Any such work done without written order first being given by the Contracting Officer shall be at CONTRACTOR's own risk, cost, and expense, even if the work will or does provide a benefit to CITY. 10. Commencement of Work. CONTRACTOR will start as soon as possible following a Notice to Proceed as the field conditions will permit and will continuously and diligently perform the work to conclusion. 11. Ootional Sooil Extraction. CONTRACTOR shall have the option to extract spoil from the Fourth of July Creek in excess of 50,000 cubic yards and any amount removed under paragraph 9, subject to the following terms and conditions: a) Unless otherwise agreed to between CITY and CONTRACTOR, all spoil extracted under this paragraph shall be obtained from the river maintenance zone. b) Within the river maintenance zone CITY shall have the right to direct where CONTRACTOR shall remove spoil for the purpose of furthering CITY's flood control and river maintenance efforts; provided, however, CITY shall direct such removal only as is reasonably necessary to meet the flood control AFOGNAK Maintenance Agreement May, 1989 Page 6 . . . needs of CITY and shall be consistent with any permit(s) issued by the u.s. Army Corps of Engineers. c) For all spoil removed under this paragraph 11 in any calendar year, the CONTRACTOR shall pay CITY a royalty of $0.50 per cubic yard of spoil sold or shipped from the work site or from CONTRACTOR's stockpile. d) This agreement authorizes sales of spoil, extracted under this or any other paragraph of this agreement, only for use within the Seward Electrical Transmission Area. e) All work performed by CONTRACTOR under this paragraph shall comply with the approved Flood Control/Channel Maintenance Plan. f) All royal ties shall be paid to CITY monthly, not later than the 15th day of the succeeding month. 12. Flood Prevention/Channel Maintenance Plan. Subject to paragraph submit CITY a Flood 2, shall to CONTRACTOR Prevention/Channel Maintenance Plan for CITY's approval prior to commencement of any work under this agreement. The Contracting Officer may require the plan to be updated more than annually. All work performed by CONTRACTOR under this agreement shall comply with the approved plan. following: The plan shall address or identify the a) a work plan, b) the river maintenance zone, AFOGNAK Maintenance Agreement May, 1989 Page 7 . . . c) the proposed location for work wi thin the river maintenance zones, d) the time period for operations, e) the disposal of unusable spoil, f) flood control efforts, g) access routes, h) stockpiling plans, i) the estimated quantity of spoil to be extracted, and j) other reasonable and relevant information for the performance of this contract as may be requested by the Contracting Officer. 13. Access Riahts. CITY reserves for itself and any others whom it may authorize the right of free access over and through the river maintenance zone for the purpose of access to Fourth of July Creek. This right shall extend to the use of roads to and through the river maintenance zone, however, use of such roads by others shall not unreasonably interfere with CONTRACTOR's operations under this agreement. 14. Disposal Spoil. CONTRACTOR shall bear sole of responsibility for disposal of all spoil, both usable and unusable, removed from Fourth of July Creek pursuant to any provision of this agreement. Unusable spoil removed from Fourth of July Creek pursuant to the river maintenance provisions of this agreement (as distinguished from the optional spoil extraction provisions of this agreement) shall be disposed of in the locations AFOGNAK Maintenance Agreement May, 1989 Page 8 . . . approved in writing in advance by the contracting officer identified by CITY. 15. Term of Agreement. The term of this agreement shall commence on the date of this agreement first written above, and shall terminate on the last day of January, 1992. 16. Interim Aareements. Any and all prior interim maintenance agreements relating to maintenance or flood control of Fourth of July Creek entered into between the parties are expressly revoked upon the execution of this agreement. 17. Insurance. CONTRACTOR shall maintain in force Worker's Compensation insurance in statutory amounts, and automobile liability and comprehensive general liability insurance including, without limitation, coverage for premises and operations, products and completed operations, contractual liability, broad form property damage and personal injury liability, in amounts not less than Five Hundred Thousand Dollars ($500,000.00) per occurrence and One Million Dollars ($1,000,000.00) aggregate (combined single limit for bodily injury and property damage) during the term of this Agreement. CONTRACTOR shall have CITY added as an additional insured on the insurance policies required by this paragraph. Such policies shall contain an agreement by the insurers that such policies shall not be cancelled without at least twenty (20) days prior written notice to CITY. CITY shall be provided certificates of all such insurance within fifteen (15) days of the date of execution of this policy and copies of all such insurance policies within forty five (45) days after the execution of this AFOGNAK Maintenance Agreement May, 1989 Page 9 . . . agreement. Copies of all replacement policies shall be provided to CITY promptly after the issuance thereof. 18. Records. CONTRACTOR shall keep accurate records of the volume of spoil removed (either by weight, volume or other standards generally accepted in the industry) from Fourth of July Creek under this agreement. Not later than 30 days after the end of each calendar quarter CONTRACTOR shall provide to CITY copies of all records relating to the volume of spoil removed during that calendar quarter. CITY shall have the right to audit CONTRACTOR's records concerning the volume of spoil removed. 19. No Exclusive Riahts. This agreement grants no exclusive rights to CONTRACTOR. CITY may enter into agreements with others for extraction of spoil from Fourth of July Creek. LESSEE: CITY: AFOGNAK LOGGING CITY OF SEWARD BY: Its BY: City Manager ATTEST: APPROVED AS TO FORM: PERKINS COlE, Attorneys for the city of Seward, Alaska Fred B. Arvidson City Attorney Linda S. Murphy, CMC/AAE City Clerk AFOGNAK Maintenance Agreement May, 1989 Page 10 . . . STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT THIS IS TO CERTIFY that on this day of , 1989, before me, the undersigned, a Notary Public in and for the State of Alaska, personally appeared MAX ROYLE and LINDA MURPHY, known to me and to me known to be the City Manager and City Clerk of the City of Seward, and known to be the individuals named in and who executed the foregoing document, and they acknowledged to me that they were authorized to execute the foregoing document by authority granted them in the Municipal Code of Ordinances for said City and for the uses and purposes therein set forth. WITNESS my hand and notarial seal the day and year first hereinabove written. Notary Public in and for Alaska My Commission Expires: STATE OF ALASKA ss. THIRD JUDICIAL DISTRICT THIS IS TO CERTIFY that on this day of , 1988, before me, the undersigned, a Notary Public in and for the State of Alaska, personally appeared , of AFOGNAK LOGGING, known to me and to me known to be the individual named in and who executed the foregoing document, and he acknowledged to me that he was authorized to execute the foregoing document by authority granted him in the Bylaws or by resolution of the Board of Directors of said corporation for the uses and purposes therein set forth. WITNESS my hand and notarial seal the day and year first hereinabove written. Notary Public in and for Alaska My Commission Expires: AFOGNAK Maintenance Agreement May, 1989 Page 11