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HomeMy WebLinkAbout4622 Resolution - Loni Luis Montes 2025 3-Year Lease AgreementRESOLUTION NO. 4622 A RESOLUTION OF THE CITY OF PASCO, WASHINGTON, AUTHORIZING THE INTERIM CITY MANAGER TO EXECUTE A 3-YEAR LEASE AGREEMENT BETWEEN LONI & LUIS MONTES AND THE CITY OF PASCO FOR OPEN LAND LOCATED BEHIND 1900 WEST A STREET PASCO, WA. WHEREAS, the City of Pasco (City) entered into a 5-Year Lease with Loni & Luis Montes, the “Premises” dated December 21, 2015, that included two 2-year extensions; and WHEREAS, the current lease and both lease extensions are completed; and WHEREAS, both the City and Loni & Luis Montes desire to establish a new 3-Year Lease Agreement for continued use of storage of materials and equipment related to the business at the Premises; and WHEREAS, the City Council of the City of Pasco, Washington, has after due consideration, determined that it is in the best interest of the City of Pasco to extend the Lease with Loni & Luis Montes at the Premises. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PASCO, WASHINGTON: That the City Council of the City of Pasco approves the terms and conditions of the Lease Agreement between Loni & Luis Montes and the City of Pasco; a copy of which is attached hereto and incorporated herein by reference as Exhibit A; and Be It Further Resolved, that the Interim City Manager of the City of Pasco, Washington, is hereby authorized, empowered, and directed to sign and execute said Lease Agreement on behalf of the City of Pasco; and to make minor substantive changes as necessary to execute the Agreement on behalf of the City of Pasco. Be It Further Resolved, that this Resolution shall take effect immediately. PASSED by the City Council of the City of Pasco, Washington, on this 21st day of July, APPROVED AS TO FORM: ___________________________ Kerr Ferguson Law, PLLC 2025. _____________________________ Pete Serrano Mayor ATTEST: _____________________________ Debra Barham, MMC City Clerk Resolution - 2025- 2028 Loni & Luis Montes Lease Agr - 1 City Attorneys LEASE AGREEMENT LONI & LUIS MONTES THIS LEASE AGREEMENT is effective _____________, hereinafter referred to as “Agreement”, by and between the City of Pasco, Washington, a Municipal Corporation, hereinafter referred to as “City", and Loni & Luis Montes, hereinafter referred to as "Lessee", and collectively as the "Parties." IN CONSIDERATION of the mutual covenants herein set out, the Parties agree as follows: 1. Description of Premises. The City hereby leases to Lessee approximately 11,000 square feet of open land, as shown on the attached Exhibit "A", Parcel Number 112330255, located behind 1900 West A Street, Pasco, Franklin County, Washington, hereinafter referred to as “Premises”. 2. Term. The term of this Agreement shall be three (3) years commencing on the 1 st day of January, 2025, and ending on the 31st day of December, 202 7. The Parties may agree to extend the lease term for two (2) additional one (1) year extensions by executing a written notice via mail stating that the Parties are interested in extending the lease for an additional year. 3. Rent. The Lessee shall pay the City as rent for the Premises, the amount of one thousand three hundred dollars ($1,300.00) per year during the term of this Agreement beginning with the calendar year 2025 with an increase of 3% annually. The rent shall be payable on or before the 31st day of January each year. Year Total 2025 $1,300.00 2026 $1,339.00 2027 $1,379.17 2028 $1,420.55 2029 $1,463.17 4. Taxes and Assessments. The Lessee shall be responsible for paying any State Leasehold Taxes assessed by the State of Washington under RCW 82.29A. These taxes shall be payable to the City at the same time as the Rent specified in Section 3 of this Agreement. Should the State of Washington modify the leasehold excise tax rate or impose any additional taxes on the leasehold, the Lessee’s tax obligation shall be adjusted accordingly. Year Total 2025 $166.92 2026 $171.93 2027 $177.09 2028 $182.40 2029 $187.87 Exhibit A 5. Use. The Lessee shall use the Premises for the following purposes: storage of materials and equipment related to Lessee’s masonry business. No other uses, activities, or operations shall be conducted by the lessee upon the Premises without first obtaining the prior written consent of the City. 6. Condition and Maintenance. a. The Lessee has inspected the Premises, is familiar with the present condition of the Premises and agrees to accept the Premises in that condition at the commencement of the term. b. Lessee shall maintain the Premises in clean and sanitary conditions, free of fire or other casualty hazards. The Lessee shall be solely responsibility for the security, maintenance, and protection of its property stored at the Premises. c. Lessee shall be required to maintain the property and fencing, in compliance with all provisions of the Pasco Municipal Code. 7. Surrender of Premises. On the termination date of the Agreement, the Lessee shall surrender the Premises to the City in the same condition as when received, excepting, however, damage by the elements, ordinary wear and tear, and additions or alterations made by the Lessee and not required by the City to be removed or altered by the Lessee. 8. Access to Premises. Notwithstanding the Lessee's use and control of the Premises, the City and its agents, employees, and/or independent contractors designated by the City, shall have the right to enter in or upon the Premises at any time during the term of the Agreement for the purpose of inspecting or repairing the Premises, provided, however, that in entering upon the Premises, the person shall not unreasonably interfere with the Lessee's use of the Premises. 9. Alterations and Improvements. The Lessee shall not be permitted to make alterations and additions to the Premises without the written approval of the City. Such approval shall not be unreasonably withheld. The Lessee may remove any alteration or improvement, if it wishes upon termination of the Agreement provided it restores the Premises to substantially the same condition as it was on the first day of the Agreement, excepting damage by the elements and ordinary wear and tear. The Lessee shall remove any improvement and alteration upon termination of this Agreement if so requested in writing by the City. Any addition or improvement made to the Premises by the Lessee and not removed shall upon termination of the Agreement belong to and become property of the City without cost to the City. Nothing shall be removed which will affect the structural integrity of the building. 10. Environmental Requirements. Lessee represents, warrants, and agrees that it will conduct its activities on and off the Premises in compliance with all applicable environmental laws. As used in this Agreement, “Environmental Laws” includes all Federal, State, and local environmental laws, rules, regulations, ordinances, judicial or administrative decrees, orders, decisions, authorizations or permits, including, but not limited to, the Resource Conservation and Recovery Act, 42 U.S.C. § 6901, et. seq., the Clean Air Act, 42 U.S.C. § 7401, et. seq., the Federal Water Pollution Control Act, 33 U.S.C. § 1251, et. seq., the Emergency Planning and Community Right to Know Act, 42 U.S.C. § 1101, et. seq., the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S. C. § 9601, et. seq., the Oil Pollution Control Act, 33 U.S.C. § 2701, et seq., and any other comparable state, local, city, county or federal statute or ordinance pertaining to the environment or natural resources and all regulations pertaining thereto. Toxic or hazardous substances are not allowed on the Premises without the express written permission of the City and under such terms and conditions as may be specified by the City. Lessee agrees that it will be responsible for all damages and costs associated with release of any such substances upon the Premises occurring during the term of this Agreement, including any cleanup costs. 11. Indemnity/Hold Harmless. Lessee shall defend, indemnify, and hold harmless the City, its officers, officials, employees, independent contractors, and/or volunteers from and against any and all claims, suits, actions, or liabilities for injury or death of any person, or for loss or damage to property, which arises out of Lessee's use of the Premises, or from the conduct of Lessee's business, or from any activity, work or thing done, permitted, or suffered by Lessee in or about the Premises, except only such injury or damage as shall have been occasioned by the sole negligence of the City. 12. Insurance. The Lessee shall procure and maintain for the duration of the Agreement, insurance against claims for injuries to persons or damage to property which may arise from or in connection with the Lessee's operation and use of the Premises. a. Minimum Scope of Insurance. Lessee shall obtain insurance of the types described below: i. Commercial General Liability insurance shall be written on Insurance Services Office (ISO) occurrence form CG 00 01 and shall cover the premises and contractual liability. The City shall be named as an insured on Lessee's Commercial General Liability insurance polity using ISO Additional Insured-Managers or Lessors of Premises Form CG 20 11 or a substitute endorsement providing equivalent coverage. ii. Property insurance shall be written on an all-risk basis. b. Minimum Amounts of Insurance. Lessee shall maintain the following insurance limits: i. Commercial General Liability insurance shall be written with limits no less than $1,000,000 each occurrence, $2,000,000 general aggregate. ii. Property insurance shall be written covering the full value of Lessee's property and improvements with no coinsurance provisions. c. Other Insurance Provisions. The insurance policies are to contain, or be endorsed to contain, the following provisions for Commercial General Liability insurance: i. The Lessee's insurance coverage shall be primary insurance with respect to the City. Any insurance, self-insurance, or insurance pool coverage maintained by the City shall be excess to the Lessee's insurance and shall not contribute with it. ii. The Lessee's insurance shall be endorsed to state that coverage shall not be cancelled by either party, except after thirty (30) days prior written notice by certified mail, return receipt requested, has been given to the City. d. Acceptability of Insurers. Insurance is to be placed with insurers with a current A.M. Best rating of not less than A:VII. e. Verification of Coverage. Lessee shall furnish the City with original certificates and a copy of the mandatory endorsements, including but not necessarily limited to the additional insured endorsement, evidencing the insurance requirements of the Lessee. f. Waiver of Subrogation. Lessee and City hereby release and discharge each other from all claims, losses, and liabilities arising from or caused by any hazard covered by property insurance on or in connection with the Premises or said building(s). This release shall apply only to the extent that such claim, loss or liability is covered by insurance. g. City 's Property Insurance. The City shall purchase and maintain during the term of the Agreement all-risk property insurance covering the buildings for their full replacement value without any coinsurance provisions. If the City is a member of a self-insured risk pool membership will satisfy listed requirements. Lessee shall comply with all insurance regulations so that the lowest fire, lightning, explosion, extended coverage, and liability insurance rates may be obtained. Nothing shall be done or kept in or on the Premises by Lessee which will cause an increase in the premium for any such insurance of the Premises or on any building of which the Premises are a part or on any contents located therein, over the rate usually obtained for the property use of the Premises permitted by this Agreement or which will cause cancellation of any such insurance. In the event the Lessee's use of the Premises is responsible for an increase in the insurance rates on the building of which the Premises are a part, then in such event, Lessee agrees to pay any resulting increase in premiums on such building. 13. Damage to Property on Premises. Lessee agrees that all property of every kind and description kept, stored, or placed in or on the Premises shall be at Lessee's sole risk and hazard and that the City shall not be responsible for any loss or damage to any of such property resulting from fire, explosion, water, steam, gas, electricity, or the elements, whether or not originating in the Premises, caused by or from leaks or defects in or breakdown of plumbing, piping, wiring, hearing, or any other facility, equipment, or fixtures or any other cause or act except resulting from the gross negligence of the City or anyone for whom the City may be responsible. 14. Damage by Casualty. In case the Premises shall be destroyed or shall be so damaged by fire or other casualty, as to become untenantable, then in such event, at the option of the City , this Agreement shall terminate from the date of such damage or destruction and the Lessee shall immediately surrender such Premises and all interest therein to the City , and Lessee shall pay rent only to the time of such surrender. The City shall exercise such option to terminate this Agreement by notice in writing delivered to Lessee within ten (10) days after such damage or destruction. In the event that the City shall not elect to terminate this Agreement, this Agreement shall continue in full force and effect and the City shall repair the Premises with all reasonable promptitude, placing the same in as good a condition as it was at the time of the damage, or abate in proportion to the extent and duration of untenantability. In either event Lessee shall remove all rubbish, debris, merchandise, furniture, equipment, and other personal property, within ten (10) days after the request of the City. If the Premises shall be only slightly injured by fire or the elements, so as not to render the same untenantable and unfit by occupancy, then the City shall repair the same within a reasonable time, and in that case the rent shall not abate. No compensation or claim shall be made by or allowed to the Lessee by reason of any inconvenience or annoyance arising from the necessity of repairing any portion of the building or the Premises, regardless of the cause of such necessity. 15. Public Requirements. Lessee shall comply with all laws, orders, ordinances, and other public requirements now or hereafter affecting the Premises or the use thereof, and Lessee agrees to hold harmless and indemnify the City from expense or damage resulting from failure to do so. The Premises is not exempted from compliance with zoning or any other municipal codes or ordinances, nor from any other requirements of law due to title being in the name of the City. 16. Termination. This Agreement shall terminate pursuant to the terms in Section 3 herein, unless terminated as follows: a. Either party may terminate this Agreement upon ninety (90) days advance written notice with any prepaid rent prorated and that portion for the unexpired term of the Agreement being refunded. 17. Assignment or Sublet. Lessee shall not assign or transfer this Agreement or any interest therein, nor sublet the whole or any part of the Premises, nor grant an option for assignment, transfer or sublease for the whole or any part of the Premises, nor shall this Agreement or any interest therein be assignable or transferable by operation of law, or by any process or proceeding of any Court or otherwise, without the prior written consent of the City. 18. Dispute Resolution. In the event of a dispute regarding the terms, interpretation or breach of this Agreement, the Parties shall first meet in a good faith to resolve the dispute. In the event the dispute cannot be resolved by agreement of the Parties, either with or without the assistance of mediation, said dispute shall be resolved by arbitration pursuant to RCW 7.04A, as amended, with both Parties waiving the right of a jury trial upon trial de novo, with venue being placed in Pasco, Franklin County, Washington. The substantially prevailing party shall be entitled to its reasonable attorney fees and costs as additional award and judgment against the other. The City retains the right to seek an unlawful detainer action or other legal action as may be necessary to regain possession of the Premises upon the default in the payment of rent, termination of the Agreement, or a material breach of the substantive provisions of this Agreement. 19. General Provisions. a. For the purposes of this Agreement, time is of the essence. b. Notices provided for in this Agreement shall be sent by mail to the physical address of the Parties or by electronic transmission to the e-mail addresses designated for the Parties below. i. City of Pasco Attn: Parks & Recreation PO Box 293 Pasco, WA 99301 (509)543-5757 Parks@pasco-wa.gov ii. Loni & Luis Montes 12231 Scenic View Dr Pasco, WA 99301 (509)948-7884 Luis@legionliners.com 20. Entire Agreement. This Agreement contains the entire understanding between and among the Parties and supersedes any prior understandings and agreements among them respecting the subject matter of this Agreement. IN WITNESS WHEREOF, the Parties have hereunto set their hand as of the date first written above. CITY OF PASCO, WASHINGTON LESSEE: Dave Zabell, Interim City Manager Loni Montes Luis Montes APPROVED AS TO FORM: Kerr Ferguson Law, PLLC, City Attorney EXHIBIT A PARCEL #: 112330255 Leased Area Outlined in Red