HomeMy WebLinkAboutMiddleton Six Sons Farms - Agriculture Lease No. 113190053CITY OF PASCO
Agricultural Lease No. 113190053 (2024),
THIS AGRICULTURAL LEASE is entered into this 1 st day of October, 2023, by and
between the City of Pasco, a Washington Municipal Corporation ("Lessor"), and Middleton Six
Sons Farms ("Lessee"). This Lease is made upon the terms and conditions and for the
consideration enumerated herein.
1. Description of Leased Property. Lessor leases to Lessee, and Lessee leases from
Lessor, on the terms and conditions stated below, a crop circle numbered 16 South (aka Parcel
113190053) for the production of agricultural products upon the following described real
property ("Premises"):
A portion of the irrigated cropland located in the NW 1/4 Section 14 Township 9N, Range
30 E, and known as Circle 16 South in Franklin County, WA - Comprising 71 acres more
or less. Also in Auditors Records of Franklin County - Parcel 113190053.
2. Term of Lease — and Provisions for Termination
The term of the Lease shall be for: Circle 16 South commencing on the 1 st Day
of October, 2023 and terminating on the 31 st day of October, 2026; unless earlier
terminated or extended as provided below. In the event this Lease terminates prior to the
completion of harvest, the term of this Lease shall be extended for a reasonable period for
time to allow for completion of harvest.
Additionally, this Lease, during the term thereof, may be terminated by either the
Lessor or Lessee for good cause AND with 60 days written notice to the other party, on
the earlier of the completion of any annual crop harvest OR October 31 st of the same
calendar year. Good cause for the Lessor is the necessity in its sole judgment to convert
use of the premises from conventional agricultural use to food Process Water Reuse.
Good cause for the Lessee is the inability on Lessee's part — due to government agency
curtailment, to continue to deliver irrigation water to the premises with sufficient
volume and pressure to properly irrigate and sustain the water requirements of the
growing crop or the next planned subsequent crop. Rent payments that may be past due
upon the date of termination shall be payable in full on or before termination of the lease
agreement.
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3. Rent.
(a) "Total Payment" shall be the annual sum of: 1) the total of all rent (rent per acre x total #
of acres;) and 2) Washington State Leasehold Tax calculated on said total rent.
(b) "Payment per acre" shall be the sum of rent per acre and 2) Washington State Leasehold
Tax as calculated on the rent per acre amount.
(c) Lessee shall pay as rent for said Premises the following amounts:
Circle No.
16 South
Growing
Year
Crop
Total
Acres
Rent Per
Acre
Tax Per
Acre
Payment
Per Acre
Total
Payment
16 South
2024
Wheat
71
$177.25
$22.75
$200
$14,200
16 South
2025
Onions
71
j $337.84
$62.16
$400
$28,400
16 South
2026
Potatoes
71
$337.84
$62.16
$400
$28,400
16 South
2027*
TBD
71
TBD
*Fourth and Fifth Year At Lessor's (City) Option Only
(d) Washington State Leasehold Excise Tax shall be paid by the Lesson
(e) Lease payments shall be due and payable on or before January 31 st of each respective
crop year year during the term of this lease agreement.
(f) All payments shall be made to the City of Pasco, c/o R. Henry Johnson, 2202 West
Clearwater Avenue, Kennewick, WA 99336, or such other place as the Lessor may
designate.
(g) In the event the Lessee desires a change in acreage, crops, or use, prior written
authorization must be received from Lessor. Approval to such change may be
conditioned upon an adjustment in the payments provided above.
4. Uses of the Premises. Lessee shall put the Leased Premises to the full beneficial
use in accordance with customary industry standards, permitted uses, acres, and crops designated
herein. Said uses shall be further restricted by the terms of any federal, state, or local law or
regulation applicable thereto, and the terms of Lessor's Water Permit from the State of
Washington; together with any other encumbrance of record or known use being exercised at the
time of the execution of this Lease. It is further understood and hereby acknowledged that the
ultimate objective of the Lessor, with respect to this property, is to prepare and utilize the
property for eventual reuse wastewater treatment and application. Accordingly, throughout each
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crop year during the term of this Lease, Lessor reserves the right and shall be entitled to test,
inspect, investigate, survey, excavate, construct, maintain, and otherwise utilize the property
constituting the Leased Premises preparatory to and/or as necessary to accomplish the stated
objective in such a manner as Lessor deems appropriate. Lessee will cooperate with Lessor to
facilitate such activities, and will not unreasonably hinder or delay any such activities.
Lessor agrees to reimburse Lessee for crop or field damage, if any, arising from the Lessor's
utilization of the Premises as set forth above. It shall be the responsibility of the Lessee to
substantiate any claimed losses with evidence satisfactory to Lessor.
5. Water and Irrigation System. Lessee shall be responsible for all costs of
operating the irrigation system on the Leased Premises, and shall be responsible for the payment
of irrigation power charges.
The premises are equipped with an irrigation system owned and installed by the Lessee,
and Lessee shall be responsible for the operation, care and repair of said system at all times
throughout the term of this Lease Agreement
6. Liens.
(a) Lessee shall pay as due all claims for work done on and for services
rendered or materials furnished to the Premises which are done for the account of the
Lessee as herein provided. Lessee shall keep the Premises free of any liens and
indemnify, defend and hold the Lessor harmless from all costs, damages, or charges,
including attorney's fees, necessary to discharge such liens. Lessor, at its option, may pay
the amount of any claim or lien and add said amount as additional rent with interest at the
rate of twelve percent (12%) per annum, or the maximum amount permitted by statute, on
said amount paid from the date of payment. Payment of a claim or lien amount shall not
constitute a waiver of any right or remedy which Lessor would otherwise have on
account of Lessee's default in this or any other term of the Lease.
(b) The Lessor may file and maintain a landlord or crop lien in order to secure
any payment or obligation required under this Lease.
7. Chemicals and Fertilizers. Lessee shall apply chemicals and fertilizers to the
Leased Premises according to standards applicable to the industry and consistent with the current
best practice standards. Lessor shall not incur any responsibility or liability to any third party for
the negligent or wrongful acts of the Lessee related to the chemicals and/or fertilizers used or its
application, and shall defend, indemnify, and hold Lessor harmless from any damages resulting
from such negligent or wrongful act of the Lessee.
8. Erosion Control and Crop Rotation. Lessee shall follow an effective program
of soil erosion control, particularly against wind and water. Lessee agrees to plant the Premises
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to a cover crop to the specifications of the Lessor within fifteen (15) days after each harvest, as
appropriate. Crops will be rotated so that potatoes will not be planted two (2) years
consecutively in the same field without the express consent of Lessor. The planting of two
consecutive crops on the same land with the intent of obtaining a harvest from both crops within
the same crop year (double cropping) is prohibited without the express written permission of
Lessor. The Lessor reserves the right with the granting of such permission to assess additional
rents from Lessee as applicable and appropriate for this practice. Grazing of crop aftermath is
not permitted.
9. Premises Maintenance. Lessee shall not commit or permit to be committed any
waste, strip, damage to, or misuse of the Premises. All farming operations shall be conducted in
a husbandlike manner according to standards of the industry. Any and all fences, gates, roads,
field accesses, and other improvements to the property (including the irrigation system) shall be
maintained by Lessee. Lessee shall eradicate weeds, particularly puncture -vine and prevent all
noxious and other weeds from encroaching upon the Premises, utilizing practices approved by
the local weed control authorities and to the reasonable satisfaction of the Lessor.
Lessee also agrees to maintain roads and field access in good, passable condition.
10. Deleterious, Hazardous. Toxic. or Harmful Substances..
(a) Deleterious Material. The Lessee shall not make, or suffer to be made,
any filling in of the lease Premises or any deposit of rock, earth, ballast, refuse, garbage,
waste matter, chemical, biological or other wastes, hydrocarbons, any other pollutants, or
other matter within or upon the lease Premises, except as approved in writing by the
Lessor. If the Lessee fails to remove all non -approved fill material, refuse, garbage,
wastes or any other of the above materials from the lease Premises, the Lessee agrees
that the Lessor may, but is not obligated to, remove such materials and charge the
Lessee for the cost of removal and disposal.
(b) Hazardous. Toxic. or Harmful Substances. The Lessee shall not keep on or
about the lease Premises, any substances now or hereinafter designated as or containing
components now or hereinafter designated as hazardous, toxic, dangerous, or harmful,
and/or which are subject to regulation as hazardous, toxic, dangerous, or harmful by any
federal, state or local law, regulation, statute or ordinance (hereinafter collectively
referred to as "Hazardous Substances") unless such are necessary to carry out the
Lessee's permitted use(s) under Section 6 above, and unless the Lessee fully complies
with all federal, state and local laws, regulations, statutes, and ordinances, now in
existence or as subsequently enacted or amended.
(c) The Lessee shall:
(1) Immediately notify the Lessor of (i) all spills or releases of any
Hazardous Substance affecting the lease Premises, (ii) all failures to comply with
any federal, state, or local law, regulation or ordinance, as now enacted or as
subsequently enacted or amended, (iii) all inspections of the lease Premises by,
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or any correspondence, orders, citations, or notifications from any regulatory
entity concerning Hazardous Substances affecting the lease Premises, (iv) all
regulatory orders or fines or all response or interim cleanup actions taken by or
proposed to be taken by any government entity or private party concerning the
lease Premises; and
(2) On request, provide copies to the Lessor of any and all
correspondence, pleadings, and/or reports received by or required of the Lessee
or issued or written by the Lessee, or on the Lessee's behalf with respect to the
use, presence, transportation, or generation of Hazardous Substances related to
the Leased Premises.
(d) The Lessee shall be. fully and completely liable to the Lessor, and shall
indemnify, defend, and hold harmless the Lessor and its agents and employees, with
respect to any and all damages, costs, fees (including attorneys' fees and costs),
penalties (civil and criminal), and cleanup costs assessed against or imposed as a result
of the Lessee's use, disposal, transportation, generation, and/or sale of Hazardous
Substances, or that of the Lessee 's employees, agents, assigns, contractors,
subcontractors, licensees, invitees, and for any breach of this subsection.
11. Indemnification. Lessee has inspected and accepts the Premises as he finds
them. Lessee agrees to assume all risk of, and indemnify, defend with legal counsel acceptable
to Lessor, and hold harmless the Lessor from any loss, costs, liability, claim or expense on
account of personal injury to or death of any persons whosoever including, but not limited to,
employees of the Lessor and damage to or destruction of property to whomsoever belonging
including, but not limited to, property of the Lessor, resulting in whole or in part, directly or
indirectly, arising from the Lessee's use of the Premises or exercise of rights herein granted.
Nothing herein contained, however, shall be construed as indemnification against the sole
negligence of the Lessor, its officers, employees, or agents.
12. Insurance. Lessee agrees, during the term of this Lease or any renewals thereof,
to carry general liability insurance for personal injury and property damage liability, and to
maintain workmen's compensation coverages as required by law. General liability insurance
policies shall name Lessor as an insured and be with an insurance carrier acceptable to Lessor.
Such insurance shall provide for property damage liability coverage of at least $100,000 and
personal injury coverage of at least $1,000,000 for each occurrence and in the aggregate. Lessee
shall furnish Lessor with certificate indicating that such insurance is in force and the premiums
therefore have been paid.
Lessee agrees to be personally responsible for the repair or replacement of any Lessor -
owned irrigation equipment component or other improvement to the property damaged by the
Lessee or Lessee's officers, employees, or agent, or as a result of their negligent acts or
omissions.
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13. Interest. Any amount due by the Lessee to the Lessor not paid within fifteen (15)
days shall bear interest at the rate of twelve (12%) per annum, or the maximum amount
permitted by statute, from the date due.
14. Sublease or Assignment meted. No part of this Lease or the Leased
Premises may be assigned, mortgaged, subleased, or otherwise transferred, without the prior
written consent of the Lessor. With such consent, the Lessor reserves the right to change the
terms and conditions of the Lease as it may affect the assignee. All terms of any sub -leasing
agreement shall be fully transparent to Lessor upon its request for same, including name and
resume of sub -lessee and rent amount and payment schedule. This provision shall equally apply
to transfers arising by operation of law, or transfers to any trustees in bankruptcy, receivers,
administrators, executors, and legatees.
15. Default. The following shall be events of default: (a) failure to pay rent on or
before the date provided in Section 4 above; (b) failure of Lessee to comply with any term or
condition or fulfill any obligation of the Lease, other than the payment of rent, within fifteen (15)
days after written notice by Lessor specifying the nature of the default with reasonable
particularity, or abandonment by the Lessee of the property; and (c) failure to pay, when due, any
tax, assessment, or payment required under the terms of this Lease. If the default is of such a
nature that it cannot be completely remedied within the fifteen (15) day period, this provision
shall be complied with if Lessee begins correction of the default within the fifteen (15) day
period and thereafter proceeds with reasonable diligence and in good faith to effect the remedy as
soon as practical.
In the event the default is not remedied as provided above, Lessor shall have the right to
re-enter, take possession of the Premises, and remove any persons or property by legal action or
by self-help with the use of reasonable force and without liability for damages. Such right shall
be cumulative and in addition to all other remedies available to the Lessor under applicable law.
Lessor may recover reasonable attorney's fees and costs expended to enforce the provisions
hereof.
In the event of an uncured default, Lessor may initiate an action, without further notice,
for an unlawful detainer or for damages with venue being placed in Franklin County,
Washington, and with the substantially prevailing party entitled to an additional judgment against
the other for their reasonable attorneys' fees and costs incurred incident to said action.
Waiver by either parry of strict performance of any provision of this Lease shall not be a
waiver of or prejudice the party's right to require strict performance of the same provision in the
future or of any other provision.
16. Notices. Any notice under this Lease shall be deemed given when actually
delivered or when deposited in the United States mail, as certified mail, postage prepared,
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addressed as follows: City of Pasco — Public Works Department. 525 N 3rd, P.O. Box 293;
Pasco, WA 99301
17. Succession. Subject to the above -stated limitations on assignment of Lessee's
interest, this Lease shall be binding upon and inure to the benefit of the parties, their respective
personal representatives, successors, and assigns.
18. Inspection of the Premises. Lessor reserves the right to itself and its agents to go
upon the Premises at reasonable and proper times to inspect the same for purpose of determining
that the Lease is being kept and performed by the Lessee.
19. Time is of the Essence. The parties acknowledge and agree that time is of the
essence with respect to all of the terms, conditions and provisions of this Lease.
20 Entirety of Lease. This document and its exhibits, incorporates the entire
agreement of the parties. No prior representation, stipulation, agreement, or understanding will
be valid or enforceable unless incorporated herein. Any changes or additions to this Lease or its
attached exhibits shall be in writing and executed by the parties hereto. Neither the Lessor, nor
the Lessee shall be bound by verbal or implied agreements.
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DATED this ( day of �1Ab`Qt/d . 2023.
LESSOR:
City of Pasco
Adam Lincoln, City Mpirager
State of Washington )
ss.
County of Franklin )
LESSEE:
Middleton Six Sons Farms
I certify that I know or have satisfactory evidence that Adam Lincoln is the person who
appeared before me, and said person acknowledged tha he she signed this instrument, on oath
stated that he he was authorized to execute the instrument and acknowledged it, as the City
Manager o the CITY OF PASCO, a Washington municipal corporation, to be the free and
voluntary act of such party for the uses and purposes mentioned in the instrument.
SUBSCRIBED and SWORN to before me this _'2)(2��day of Qr C 20,R3.
NICOLE EDWARDS
NOTARY PUSUC #23024488
STATE OF WASHWGTON NOTARY PUBLIC in and for the State of Washington
COMMISSION EXPIRES
JUNE 7 2027 Residing at
My Commission Expires: S
State of Washington )
ss.
County of Franklin )
SUBSCRIBED and SWORN to before me this day of , 20_jj.
Notary Pub
Sbte of Wnbiuo•
OTARY PUBLIC in and for the State of Washington
JANETTE SALAZAR ROIMERO
Residing at VA(,ky, � �
LICENSE # 19'EX
MY COMMISSION EXPIRES
My Commission Expires:
P bI Ha 202 V
JA N UA RY 6. 2026
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