HomeMy WebLinkAboutWA State DNR Aquatic Lands Lease STATE OF WASHINGTON
DEPARTMENT OF NATURAL RESOURCES
DOUG SUTHERLAND, Commissioner of Public Lands
AQUATIC LANDS LEASE
TABLE OF CONTENTS
1. PROPERTY..........................................................................................................................1
1.1 Property Defined.............................................................................................................. 1
1.2 Survey and Property Descriptions.................................................................................2
1.3 Inspection .........................................................................................................................2
2. USE........................................................................................................................................2
2.1 Permitted Use...................................................................................................................2
2.2 Restrictions on Use..........................................................................................................2
2.3 Conformance with Laws.................................................................................................3
2.4 Liens and Encumbrances................................................................................................3
3. TERM....................................................................................................................................3
3.1 Term Defined...................................................................................................................3
3.2 Renewal of the Lease.......................................................................................................3
3.3 End of Term.....................................................................................................................3
3.4 Hold Over.........................................................................................................................4
4. RENT....................................................................................................................................4
4.1 Annual Rent.....................................................................................................................4
4.2 Payment Place..................................................................................................................4
4.3 Adjustment Based on Use...............................................................................................5
4.4 Rent Adjustment Procedures .........................................................................................5
4.5 Rent Adjustments for Water-Dependent Uses..............................................................5
5. OTHER EXPENSES ...........................................................................................................5
5.1 Utilities..............................................................................................................................5
5.2 Taxes and Assessments....................................................................................................6
5.3 Right to Contest...............................................................................................................6
5.4 Proof of Payment.............................................................................................................6
5.5 Failure to Pay...................................................................................................................6
6. LATE PAYMENTS AND OTHER CHARGES...............................................................6
6.1 Late Charge......................................................................................................................6
6.2 Interest Penalty for Past Due Rent and Other Sums Owed........................................6
6.3 Referral to Collection Agency and Collection Agency Fees ........................................6
6.4 No Accord and Satisfaction ............................................................................................7
6.5 No Counterclaim, Setoff, or Abatement of Rent...........................................................7
7. IMPROVEMENTS..............................................................................................................7
7.1 Improvements Defined....................................................................................................7
7.2 Existing Improvements ...................................................................................................7
7.3 Construction,Alteration,Replacement, and Modification..........................................7
7.4 Disposition and Removal of Tenant-Owned Improvements at End of Lease............S
7.5 Disposition of Unauthorized Improvements.................................................................9
Form Date: 1/2007 i Lease No.20-081594
7.6 Disposition of Personal Property.................................................................................. 10
8. ENVIRONMENTAL LIABILITY/RISK ALLOCATION............................................10
8.1 Definitions.......................................................................................................................10
8.2 General Conditions........................................................................................................ 10
8.3 Current Conditions and Duty to Investigate...............................................................11
8.4 Use of Hazardous Substances....................................................................................... 11
8.5 Management of Contamination................................................................................... 11
8.6 Notification and Reporting........................................................................................... 12
8.7 Indemnification.............................................................................................................. 12
8.8 Reservation of Rights.................................................................................................... 13
8.9 Cleanup........................................................................................................................... 14
8.10 Sampling by State, Reimbursement, and Split Samples............................................ 14
9. ASSIGNMENT AND SUBLETTING..............................................................................15
9.1 State Consent Required................................................................................................. 15
9.2 Rent Payments Following Assignment........................................................................15
9.3 Terms of Subleases........................................................................................................ 15
9.4 Short-Term Subleases of Moorage Slips..................................................................... 16
10. INDEMNITY, FINANCIAL SECURITY,INSURANCE..............................................16
10.1 Indemnity....................................................................................................................... 16
10.2 Insurance Terms............................................................................................................ 17
10.3 Insurance Types and Limits......................................................................................... 18
10.4 Financial Security..........................................................................................................20
11. MAINTENANCE AND REPAIR.....................................................................................21
11.1 State's Repairs................................................................................................................21
11.2 Tenant's Repairs, Alteration,Maintenance and Replacement..................................21
12 DAMAGE OR DESTRUCTION......................................................................................21
12.1 Notice and Repair..........................................................................................................21
12.2 State's Waiver of Claim................................................................................................21
12.3 Insurance Proceeds........................................................................................................21
12.4 Rent in the Event of Damage or Destruction.............................................................21
12.5 Default at the Time of Damage or Destruction...........................................................21
13. CONDEMNATION...........................................................................................................22
13.1 Definitions.......................................................................................................................22
13.2 Effect of Taking.............................................................................................................22
13.3 Allocation of Award.......................................................................................................22
14. DEFAULT AND REMEDIES ..........................................................................................23
14.1 Default Defined..............................................................................................................23
14.2 Tenant's Right to Cure..................................................................................................23
14.3 Remedies......................................................................................................................... 23
15. ENTRY BY STATE...........................................................................................................24
16. DISCLAIMER OF QUIET ENJOYMENT.....................................................................24
16.1 No Guaranty or Warranty............................................................................................ 24
16.2 In the Event of Eviction by Third Party...................................................................... 24
17. NOTICE..............................................................................................................................24
18. MISCELLANEOUS ..........................................................................................................25
18.1 Authority........................................................................................................................25
Form Date: 1/2007 it Lease No.20-081594
18.2 Successors and Assigns..................................................................................................25
18.3 Headings.........................................................................................................................25
18.4 Entire Agreement..........................................................................................................25
18.5 Waiver.............................................................................................................................25
18.6 Cumulative Remedies....................................................................................................25
18.7 Time is of the Essence....................................................................................................25
18.8 Language........................................................................................................................26
18.9 Invalidity......................................................................................................................... 26
18.10 Applicable Law and Venue...........................................................................................26
18.11 Recordation.................................................................................................................... 26
18.12 Modification................................................................................................................... 26
18.13 Survival........................................................................................................................... 27
Exhibit A: Record of Survey
Exhibit B: Plan of Operations
Form Date: 112007 11I Lease No.20-081594
STATE OF WASHINGTON
DEPARTMENT OF NATURAL RESOURCES
DOUG SUTHERLAND, Commissioner of Public Lands
AQUATIC LANDS LEASE
AQUATIC LANDS LEASE NO. 20-081594
THIS LEASE is made by and between the STATE OF WASHINGTON, acting through the
Department of Natural Resources ("State"), and CITY OF PASCO, a government agency/entity
("Tenant").
BACKGROUND
Tenant desires to lease the aquatic lands commonly known as Chiawana Park on the Columbia
River which is shorelands and bedlands located in Franklin County, Washington, from State, and
State desires to lease the property to Tenant pursuant to the terms and conditions of this Lease.
THEREFORE, the parties agree as follows:
SECTION 1 PROPERTY
1.1 Property Defined.
(a) State leases to Tenant and Tenant leases from State the real property described in
Exhibit A together with all the rights of State, if any, to improvements on and
easements benefiting the Property, but subject to the exceptions and restrictions
set forth in this Lease (collectively the "Property").
(b) This Lease is subject to all valid interests of third parties noted in the records of
Franklin County, or on file in the office of the Commissioner of Public Lands,
Olympia, Washington; rights of the public under the Public Trust Doctrine or
federal navigation servitude; and treaty rights of Indian Tribes.
(c) Not included in this Lease are any right to harvest, collect or damage any natural
resource, including aquatic life or living plants, any water rights, or any mineral
Form Date: 112007 1 Lease No.20-081594
rights, including any right to excavate or withdraw sand,gravel, or other valuable
materials.
(d) State reserves the right to grant easements and other land uses on the Property to
others when the easement or other land uses will not unreasonably interfere with
Tenant's Permitted Use.
1.2 Survey and Property Descriptions.
(a) Tenant prepared Exhibit A, which describes the Property. Tenant warrants that
Exhibit A is a true and accurate description of the Lease boundaries and the
improvements to be constructed or already existing in the Lease area.
(b) Tenant shall not rely on any written legal descriptions, surveys, plats, or diagrams
("property description")provided by State. Tenant shall not rely on State's
approval or acceptance of Exhibit A or any other Tenant-provided property
description as affirmation or agreement that Exhibit A or other property
description is true and accurate. Tenant's obligation to provide a true and
accurate description of the Property boundaries shall be a material term of this
Lease.
1.3 Inspection. State makes no representation regarding the condition of the Property,
improvements located on the Property, the suitability of the Property for Tenant's Permitted Use,
compliance with governmental laws and regulations, availability of utility rights, access to the
Property,or the existence of hazardous substances on the Property. Tenant has inspected the
Property and accepts it"AS IS."
SECTION 2 USE
2.1 Permitted Use. Tenant shall use the Property for a public use and access recreational
dock (the"Permitted Use"), and for no other purpose. The Permitted Use is described or shown
in greater detail in Exhibit B, the terms and conditions of which are incorporated by reference
and made a part of this Lease. This is a water-dependant use.
2.2 Restrictions on Use.
(a) Tenant shall not cause or permit any damage to natural resources on the Property.
(b) Tenant shall also not cause or permit any filling activity to occur on the Property
or adjacent state-owned aquatic land. This prohibition includes any deposit of
rock, earth, ballast,wood waste, refuse, garbage, waste matter(including
chemical, biological, or toxic wastes), hydrocarbons, any other pollutants, or other
matter in or on the Property,except as approved in writing by State.
(c) Tenant shall neither commit nor allow waste to be committed to or on the
Property or adjacent state-owned aquatic land.
(d) Failure to Comply with Restrictions on Use.
(1) If State gains actual knowledge of Tenant's failure to comply with any of
the restrictions set out in this Subsection 2.2, State may notify Tenant and
provide Tenant a reasonable time to take all steps necessary to remedy the
Form Date: 1/2007 2 Lease No.20-081594
failure and restore the Property to the condition before the failure
occurred.
(2) If Tenant fails to restore the Property in a timely manner, then State may
take any steps reasonably necessary to restore the Property. Upon demand
by State, Tenant shall pay all costs of any remedial action, including but
not limited to the costs of removing and disposing of any material
deposited improperly on the Property.
(e) State's failure to notify Tenant of Tenant's failure to comply with all or any of the
restrictions set out in this Subsection 2.2 does not constitute a waiver of any
remedies available to State.
(f) This section shall not in any way limit Tenant's liability under Section 8, below.
2.3 Conformance with Laws. Tenant shall, at all times, keep current and comply with all
conditions and terms of any permits, licenses, certificates, regulations, ordinances, statutes, and
other government rules and regulations regarding its use or occupancy of the Property.
2.4 Liens and Encumbrances. Tenant shall keep the Property free and clear of any liens
and encumbrances arising out of or relating to its use or occupancy of the Property.
SECTION 3 TERM
3.1 Term Defined. The term of this Lease is twelve (12) years (the"Term"), beginning on
the 1 st day of September, 2007 (the"Commencement Date"), and ending on the 31 st day of
August, 2019 (the"Termination Date"), unless terminated sooner under the terms of this Lease.
3.2 Renewal of the Lease. This Lease does not provide a right of renewal. Tenant may
apply for a new lease, which State has discretion to grant.
3.3 End of Term.
(a) Upon the expiration or termination of this Lease, Tenant shall surrender the
Property to State in the same or better condition as on the Commencement Date,
reasonable wear and tear excepted.
(b) Definition of Reasonable Wear and Tear.
(1) Reasonable wear and tear is defined as deterioration resulting from the
intended use of the leasehold that has occurred without neglect,
negligence, carelessness, accident, or abuse of the premises by Tenant or
any other person on the premises with the permission of Tenant.
(2) Reasonable wear and tear shall not include any deposit of rock, earth,
ballast, wood waste, refuse, garbage, waste matter(including chemical,
biological or toxic wastes), hydrocarbons, any other pollutants, or other
matter in or on the Property that State has not expressly approved of in
writing regardless of whether the deposit is incidental to or the byproduct
of the intended use of the leasehold.
(c) If Property is in worse condition, excepting for reasonable wear and tear, on the
surrender date than on the Commencement Date,the following provisions apply.
Form Date: 1/2007 3 Lease No.20-081594
(c) If Property is in worse condition, excepting for reasonable wear and tear, on the
surrender date than on the Commencement Date, the following provisions apply.
(1) State shall provide Tenant a reasonable time to take all steps necessary to
remedy the condition of the Property. State, at its option,may require
Tenant to enter into a right-of-entry or other use authorization prior to the
Tenant entering the Property to remedy any breach of this Subsection 3.3.
(2) If Tenant fails to remedy the condition of the Property in a timely manner,
then State may take any steps reasonably necessary to remedy Tenant's
failure. Upon demand by State, Tenant shall pay all costs of such
remedial action, including but not limited to the costs of removing and
disposing of any material deposited improperly on the Property, lost rent
resulting from the condition of the Property prior to and during remedial
action, and any administrative costs associated with the remedial action.
3.4 Holdover.
(a) If Tenant remains in possession of the Property after the Termination Date, the
occupancy shall not be an extension or renewal of the Term. The occupancy shall
be a month-to-month tenancy, on terms identical to the terms of this Lease, which
may be terminated by either party on thirty (30) days' written notice.
(1) The monthly rent during the holdover shall be the same rent that would be
due if the Lease were still in effect and all adjustments in rent were made
in accordance with its terms.
(2) Payment of more than the monthly rent shall not be construed to create a
periodic tenancy longer than month-to-month. If Tenant pays more than
the monthly rent and State provides notice to vacate the property, State
shall refund the amount of excess payment remaining after the Tenant
ceases occupation of the Property.
(b) If State provides a notice to vacate the Property in anticipation of the termination
of this Lease or at any time after the Termination Date and Tenant fails to do so
within the time set forth in the notice, then Tenant shall be a trespasser and shall
owe the State all amounts due under RCW 79.02.300 or other applicable law.
SECTION 4 RENT
4.1 Annual Rent.
(a) Until adjusted as set forth below, Tenant shall pay to State an annual rent of Zero
Dollars ($0.00), related to water-dependant use.
(b) The annual rent, as it currently exists or as adjusted or modified (the "Annual
Rent"), shall be due and payable in full on or before the Commencement Date and
on or before the same date of each year thereafter.
4.2 Payment Place. Payment is to be made to Financial Management Division, 1111
Washington St SE, PO Box 47041, Olympia, WA 98504-7041.
Form Date: 1/2007 4 Lease No. 20-081594
4.3 Adjustment Based on Use. Annual Rent is based on Tenant's Permitted Use of the
Property, as described in Section 2 above. If Tenant's Permitted Use changes, the Annual Rent
shall be adjusted as appropriate for the changed use.
4.4 Rent Adjustment Procedures.
(a) Notice of Rent Adjustment. Notice of any adjustments to the Annual Rent that
are allowed by Paragraphs 4.5(b) shall be provided to Tenant in writing no later
than ninety(90) days after the anniversary date of the Lease.
(b) Procedures on Failure to make Timely Adjustment. In the event the State fails to
provide the notice required in Paragraph 4.4(a), it shall be prohibited from
collecting any adjustments to rent only for the year in which it failed to provide
notice. No failure by State to adjust Annual Rent pursuant to Paragraph 4.4(a)
shall affect the State's right to establish Annual Rent for a subsequent lease year
as if the missed or waived adjustment had been implemented. The State may
adjust, bill, and collect Annual Rent prospectively as if any missed or waived
adjustments had actually been implemented. This includes the implementation of
any inflation adjustment and any rent revaluations that would have been
authorized for previous lease years.
4.5 Rent Adjustments for Water-Dependent Uses.
(a) Inflation Adjustment. State shall adjust water-dependent rent annually pursuant
to RCW 79.105.200-.360, except in those years in which the rent is revalued
under Paragraph 4.5(b) below. This adjustment shall be effective on the
anniversary of the Commencement Date.
(b) Revaluation of Rent. At the end of the first four-year period of the Term, and at
the end of each subsequent four-year period, State shall revalue the
water-dependent Annual Rent in accordance with RCW 79.105.200-.360.
(c) Rent Cap. After the initial year's rent is determined under Subsection 4.1, rent
may increase by operation of Paragraph 4.5(a) or 4.5(b). If application of the
statutory rent formula for water-dependent uses would result in an increase in the
rent attributable to such uses of more than fifty percent(50%) in any one year,the
actual increase implemented in such year shall be limited to fifty percent (50%) of
the then-existing rent, in accordance with RCW 79.105.260. The balance of the
increase determined by the formula shall be deferred to subsequent years and
added to the next and subsequent years' rental increases until the full amount of
the increase is lawfully implemented.
SECTION 5 OTHER EXPENSES
5.1 Utilities. Tenant shall pay all fees charged for utilities in connection with the use and
occupancy of the Property, including but not limited to electricity, water, gas, and telephone
service.
Form Date: 1/2007 5 Lease No. 20-081594
5.2 Taxes and Assessments. Tenant shall pay all taxes (including leasehold excise taxes),
assessments, and other governmental charges, of any kind whatsoever, applicable or attributable
to the Property, Tenant's leasehold interest,the improvements, or Tenant's use and enjoyment of
the Property.
5.3 Right to Contest. Tenant may, in good faith, contest any tax or assessment at its sole
cost and expense. At the request of State, Tenant shall furnish reasonable protection in the form
of a bond or other security, satisfactory to State, against any loss or liability by reason of such
contest.
5.4 Proof of Payment. If required by State, Tenant shall furnish to State receipts or other
appropriate evidence establishing the payment of any amounts required to be paid under the
terms of this Lease.
5.5 Failure to Pay. If Tenant fails to pay any of the amounts due under this Lease, State
may pay the amount due, and recover its cost in accordance with the provisions of Section 6.
SECTION 6 LATE PAYMENTS AND OTHER CHARGES
6.1 Late Charge. If State does not receive any rental payment within ten(10) days of the
date due, Tenant shall pay to State a late charge equal to four percent(4%) of the amount of the
payment or Fifty Dollars ($50), whichever is greater,to defray the overhead expenses of State
incident to the delay. Failure to pay rent constitutes a default by the Tenant and State may seek
remedies under Section 14 as well as late charges and interest as provided in this section.
6.2 Interest Penalty for Past-Due Rent and Other Sums Owed.
(a) If State does not receive rent within thirty (30) days of the date due,then Tenant
shall pay interest on the amount outstanding at the rate of one percent(1%) per
month until paid, in addition to paying the late charges determined under
Subsection 6.1, above.
(b) If State pays or advances any amounts for or on behalf of Tenant, including but
not limited to leasehold taxes, taxes, assessments, insurance premiums, costs of
removal and disposal of unauthorized materials pursuant to Subsection 2.2 above,
costs of removal and disposal of improvements pursuant to Section 7 below, or
other amounts not paid when due, Tenant shall reimburse State for the amount
paid or advanced and shall pay interest on that amount at the rate of one percent
(1%)per month from the date State notifies Tenant of the payment or advance.
6.3 Referral to Collection Agency and Collection Agency Fees. If State does not receive
payment within thirty (30) days of the due date, State has discretion to refer the unpaid amount to
a collection agency as provided by RCW 19.16.500 or other applicable law. Upon referral,
Tenant shall pay collection agency fees in addition to the unpaid amount. Under RC W
19.16.500, a collection agency fee of up to fifty percent(50%) of the first One Hundred
Thousand Dollars ($100,000) of unpaid debt and up to thirty-five percent (35%) of unpaid debt
over One Hundred Thousand Dollars ($100,000) is reasonable.
Form Date: 1/2007 6 Lease No.20-081594
6.4 No Accord and Satisfaction. If Tenant pays, or State otherwise receives, an amount less
than the full amount then due, State may apply such payment as it elects. In the absence of an
election, the payment or receipt shall be applied first to accrued taxes which State has advanced
or may be obligated to pay, then to other amounts advanced by State, then to late charges and
accrued interest, and then to the earliest rent due. State may accept any payment in any amount
without prejudice to State's right to recover the balance of the rent or pursue any other right or
remedy. No endorsement or statement on any check, any payment, or any letter accompanying
any check or payment shall constitute or be construed as accord and satisfaction.
6.5 No Counterclaim, Setoff, or Abatement of Rent. Except as expressly set forth
elsewhere in this Lease, rent and all other sums payable by Tenant pursuant to this Lease shall be
paid without the requirement that State provide prior notice or demand, and shall not be subject
to any counterclaim, setoff, deduction, defense or abatement.
SECTION 7 IMPROVEMENTS
7.1 Improvements Defined.
(a) Improvements. Consistent with RCW 79.105 through 79.145, Improvements are
additions within, upon, or attached to the land. This includes,but'is not limited
to, fill, structures, bulkheads, docks, pilings, and other fixtures.
(b) Personal Property. Personal property is defined as items that can be removed
from the Property without(1) injury to the Property or Improvements or (2)
diminishing the value or utility of the Property or Improvements.
(c) State-Owned Improvements. State-Owned Improvements are Improvements
made or owned by State. State-Owned Improvements includes any construction,
alteration, or addition to State-Owned Improvements made by Tenant.
(d) Tenant-Owned Improvements. Tenant-Owned Improvements are Improvements
made by Tenant with State's consent or acquired by Tenant from former tenant in
accordance with RCW 79.125.300 or 79.130.040.
(e) Unauthorized Improvements. Unauthorized Improvements are Improvements
made on the Property without State's prior consent or Improvements made by
Tenant that are not in conformance with plans submitted to and approved by the
State.
7.2 Existing Improvements. On the Commencement Date, the following Improvements are
located on the Property: Three steel pilings, 60' x 8' dock, 9' x 10' landing attached for
gangway, 40' x 6' rotating gangway, 32' x 7' gangway. The Improvements are Tenant-Owned.
7.3 Construction,Alteration, Replacement, and Modification.
(a) Tenant shall not place, construct, remove, or demolish Improvements without
State's prior written consent. State may deny consent if State determines that
denial is in the best interests of the State. State's consent is not required for
routine maintenance or repair to Improvements made by the Tenant pursuant to its
obligation to maintain the Property in good order and repair. Routine
maintenance or repair does not include alteration, replacement, removal, or major
Form Date: 1/2007 7 Lease No.20-081594
repair of any Improvements on the Property. Subsection 7.4 shall govern removal
of Improvements at end of Lease.
(b) Prior to any placement, construction, alteration, replacement, removal, or major
repair of any Improvements (whether State-Owned or Tenant-Owned), Tenant
shall submit to State plans and specifications that describe the proposed activity.
If State does not notify Tenant of its grant or denial of consent within sixty (60)
days of submittal, State waives the requirement for State's written consent with
regards to Tenant's proposed plans or activity.
(c) Construction shall not commence until Tenant has obtained a performance and
payment bond in an amount equal to one hundred twenty-five percent(125%) of
the estimated cost of construction. The performance and payment bond shall be
maintained until the costs of construction, including all laborers and material
persons, have been paid in full.
(d) Upon completion of construction, Tenant shall promptly provide State with as-
built plans and specifications.
(e) State shall not charge rent for authorized Improvements installed by Tenant
during this Lease, but State may charge rent for such Improvements when and if
the Tenant or successor obtains a subsequent use authorization for the Property
and State has waived the requirement for Improvements to be removed as
provided in Subsection 7.4.
7.4 Disposition and Removal of Tenant-Owned Improvements at End of Lease.
(a) Disposition
(1) Tenant shall remove Tenant-Owned Improvements upon the expiration,
termination, or cancellation of the Lease unless State waives the
requirement for removal.
(2) Tenant-Owned Improvements remaining on the Property on the
expiration,termination or cancellation date shall become State-Owned
Improvements without payment by State, unless State elects otherwise.
State may refuse or waive ownership. If RCW 79.125.300 or 79.130.040
apply at the time this Lease expires, Tenant may be entitled to payment by
the new tenant for Tenant-Owned Improvements.
(3) If Tenant-Owned Improvements remain on the Property after the
expiration, termination, or cancellation date without State's actual or
deemed consent, Tenant-Owned Improvements, State may remove all
Improvements and Tenant shall pay the costs of removal and disposal.
(b) Conditions Under Which State May Waive Removal of Tenant-Owned
Improvements.
(1) State has option to waive removal of any or all Tenant-Owned
Improvements whenever State determines that it is in the best interests of
the State and regardless of whether Tenant re-leases the Property.
(2) If Tenant re-leases the Property, State may waive requirement remove
Tenant-Owned Improvements. State also may consent to Tenant's
continued ownership of Tenant-Owned Improvements.
Form Date: 1/2007 8 Lease No.20-081594
(3) If Tenant does not re-lease the Property, State has option to waive
requirement to remove Tenant-Owned Improvements upon consideration
of a timely request from Tenant, as follows:
(i) Tenant must notify State at least one (1) year before the
Termination Date of its request to leave Tenant-Owned
Improvements.
(ii) State, within ninety(90) days, shall notify Tenant whether State
consents to any or all Tenant-Owned Improvements remaining.
State has no obligation to grant consent.
(iii) State's failure to respond to Tenant's request to leave
Improvements within ninety (90) days shall be deemed a denial of
the request.
(c) Removal.
(1) Tenant shall not remove or demolish Tenant-Owned Improvements
without State's prior written consent.
(2) At least ninety (90) days prior to planned removal and/or demolition,
Tenant shall submit to State plans and specifications that describe the
proposed activity. If regulatory permits are required for removal and/or
demolition of Improvements, Tenant shall submit plans and specifications
at least sixty (60) days before submitting permit applications to the
regulatory agencies unless Tenant and State otherwise agree to coordinate
permit applications.
(3) Within sixty (60) days of receiving Tenant's plans and specifications,
State shall notify Tenant that States grants consent for removal and/or
demolition as proposed. State may impose additional conditions
reasonably intended to protect and preserve the Property. State also may
waive removal of any or all Improvements.
(4) State's failure to respond to Tenant's submittal within sixty(60) days shall
be a waiver of the requirement for State's consent and Tenant may
commence with the proposed activity.
(d) Tenant's Obligations if State Waives Removal.
(1) Tenant shall not remove Improvements if State waives the requirement for
removal of any or all Tenant-Owned Improvements.
(2) Tenant shall maintain such Improvements in accordance with this Lease
until the expiration,termination, or cancellation date. Tenant shall be
liable to State for cost of repair if Tenant causes or allows damage to
Improvements State has designated to remain.
7.5 Disposition of Unauthorized Improvements.
(a) Unauthorized Improvements shall be the property of State, unless State elects
otherwise.
(b) State, at its option, may either:
(1) Consent to Tenant ownership of the Improvements, or
(2) Charge rent for use of the Improvements from the time of installation or
construction and
Form Date: 1/2007 9 Lease No.20-081594
(i) Require Tenant to remove the Improvements, in which case Tenant
shall pay rent for the Improvements until removal,
(ii) Consent to Improvements remaining and Tenant shall pay rent for
the use of the Improvements, or
(iii) Remove Improvements and Tenant shall pay for the cost of
removal and disposal, in which case Tenant shall pay rent for use
of the Improvements until removal and disposal.
7.6 Disposition of Personal Property.
(a) Tenant retains ownership of Personal Property unless Tenant and State agree
otherwise in writing.
(b) Tenant shall remove Personal Property from the Property by the Termination
Date. Tenant shall be liable for any and all damage to the Property and any
Improvements that may result from removal of Personal Property.
(c) State, at its option, may sell or dispose of all Personal Property left on the
Property after the Termination Date.
(1) If State conducts a sale of Personal Property, State shall apply proceeds
first to the State's administrative costs in conducting the sale, second to
payment of amount that then may be due from the Tenant to the State, and
State shall pay the remainder, if any,to the Tenant.
(2) If State disposes of Personal Property, Tenant shall pay for the cost of
removal and disposal.
SECTION 8 ENVIRONMENTAL LIABILITY/R.ISK ALLOCATION
81 Definitions.
(a) "Hazardous Substance"means any substance that now or in the future becomes
regulated or defined under any federal, state, or local statute, ordinance, rule,
regulation, or other law relating to human health, environmental protection,
contamination, pollution, or cleanup, including, but not limited to,the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. 6901 et. seq., as amended;
Comprehensive Environmental Response, Compensation and Liability Act of
1980 ("CERCLA"), 42 U.S.C. 9601 et seq., as amended; Washington's Model
Toxics Control Act ("MTCA"), Chapter 70.105 RCW, as amended; and
Washington's Sediment Management Standards, WAC Chapter 173-204.
(b) "Release or threatened release of Hazardous Substance"means a release or
threatened release as defined under any law described in Paragraph 8.1(a) or any
similar event defined under any such law.
(c) "Utmost care"means such a degree of care as would be exercised by a very
careful, prudent, and competent person under the same or similar circumstances;
the standard of care established under MTCA, RCW 70.105D.040.
8.2 General Conditions.
(a) Tenant's obligations under this Section 8 extend to the area in, on, under, or
above:
Form Date: 112007 10 Lease No.20-081594
(1) The Property and
(2) Adjacent state-owned aquatic lands where a release or the presence of
Hazardous Substances arises from Tenant's use of the Property.
(b) Standard of Care.
(1) Tenant shall exercise the utmost care with respect to Hazardous
Substances.
(2) Tenant shall exercise utmost care for the foreseeable acts or omissions of
third parties affecting Hazardous Substances, and the foreseeable
consequences of those acts or omissions, to the extent required to establish
a viable,third-party defense under the law, including—but not limited to—
RCW 70.105D.040.
8.3 Current Conditions and Duty to Investigate.
(a) State makes no representation about the condition of the Property. Hazardous
Substances may exist in, on,under, or above the Property.
(b) This Lease does not impose a duty on State to conduct investigations or supply
information to Tenant about Hazardous Substances.
(c) Tenant is responsible for conducting all appropriate inquiry and gathering
sufficient information concerning the Property and the existence, scope, and
location of any Hazardous Substances on the Property, or adjacent to the Property,
that allows Tenant to meet Tenant's obligations under this Lease.
8.4 Use of Hazardous Substances.
(a) Tenant, its subtenants, contractors, agents, employees, guests, invitees, or
affiliates shall not use, store, generate, process, transport, handle, release, or
dispose of Hazardous Substances, except in accordance with all applicable laws.
(b) Tenant shall not undertake, or allow others to undertake by Tenant's permission,
acquiescence, or failure to act, activities that:
(1) Result in a release or threatened release of Hazardous Substances, or
(2) Cause, contribute to, or exacerbate any contamination exceeding
regulatory cleanup standards whether the regulatory authority requires
cleanup before, during, or after Tenant's occupancy of the Property.
8.5 Management of Contamination.
(a) Tenant shall not undertake activities that:
(1) Damage or interfere with the operation of remedial or restoration
activities;
(2) Result in human or environmental exposure to contaminated sediments;
(3) Result in the mechanical or chemical disturbance of on-site habitat
mitigation.
(b) If requested, Tenant shall allow reasonable access to:
(1) Employees and authorized agents of the Environmental Protection
Agency,the Washington State Department of Ecology, health department,
or other similar environmental agencies; and
Form Date: 112007 Lease No.20-081594
(2) Potentially liable or responsible parties who are the subject of an order or
consent decree that requires access to the Property. Tenant may negotiate
an access agreement with such parties, but Tenant may not unreasonably
withhold such agreement.
8.6 Notification and Reporting.
(a) Tenant shall immediately notify State if Tenant becomes aware of any of the
following:
(1) A release or threatened release of Hazardous Substances;
(2) Any new discovery of or new information about a problem or liability
related to, or derived from, the presence of any Hazardous Substance;
(3) Any lien or action arising from the foregoing;
(4) Any actual or alleged violation of any federal, state, or local statute,
ordinance, rule, regulation, or other law pertaining to Hazardous
Substances;
(5) Any notification from the US Environmental Protection Agency (EPA) or
the Washington State Department of Ecology (DOE)that remediation or
removal of Hazardous Substances is or may be required at the Property.
(b) Tenant's duty to report under Paragraph 8.6(a) extends to the Property, adjacent
state-owned aquatic lands where a release or the presence of Hazardous
Substances could arise from the Tenant's use of the Property, and any other
property used by Tenant in conjunction with Tenant's use of the Property where a
release or the presence of Hazardous Substances on the other property would
affect the Property.
(c) Tenant shall provide State with copies of all documents concerning environmental
issues associated with the Property, and submitted by Tenant to any federal, state
or local authorities. Documents subject to this requirement include, but are not
limited to, applications, reports, studies, or audits for National Pollution
Discharge and Elimination System Permits; Army Corps of Engineers permits;
State Hydraulic Project Approvals (HPA); State Water Quality certification;
Substantial Development permit; and any reporting necessary for the existence,
location, and storage of Hazardous Substances on the Property.
8.7 Indemnification.
(a) "Liabilities" as used in this Subsection 8.7 means any claims, demands,
proceedings, lawsuits, damages, costs, expenses, fees (including attorneys' fees
and disbursements),penalties, or judgments.
(b) Tenant shall fully indemnify, defend, and hold State harmless from and against
any liabilities that arise out of, or are related to:
(1) The use, storage, generation, processing, transportation, handling, or
disposal of any Hazardous Substance by Tenant, its subtenants,
contractors, agents, invitees, guests, employees, affiliates, licensees, or
permittees regardless of whether the act occurs before, during, or after the
Term of this Lease;
Form Date: 1/2007 12 Lease No.20-081594
(2) The release or threatened release of any Hazardous Substance, or the
exacerbation of any Hazardous Substance contamination resulting from
any act or omission of Tenant, its subtenants, contractors, agents,
employees, guests, invitees, or affiliates regardless of whether the release,
threatened release, or exacerbation occurs before, during, or after the Term
of this Lease.
(c) Tenant shall fully indemnify, defend, and hold State harmless for any and all
liabilities that arise out of or are in any way related to Tenant's breach of
obligations under Subsection 8.5.
(d) Third Parties.
(1) Tenant has no duty to indemnify State for acts or omissions of third parties
unless Tenant fails to exercise utmost care with respect to the foreseeable
acts or omissions of the third party and the foreseeable consequences of
those acts or omissions to the extent required to establish a viable third-
party defense under the law, including—but not limited to—RCW
70.105D.040. Tenant's third-party indemnification duty arises under the
conditions described in Subparagraph 8.7(d)(2).
(2) If an administrative or legal proceeding arising from a release or
threatened release of Hazardous Substances finds or holds that Tenant
failed to exercise care as described in Subparagraph 8.7(d)(1), Tenant shall
fully indemnify, defend, and hold State harmless from and against any
liabilities arising from the acts or omissions of third parties in relation to
the release or threatened release of Hazardous Substances. This shall
include any liabilities arising before the finding or holding in the
proceeding.
8.8 Reservation of Rights.
(a) For any environmental liabilities not covered by the indemnification provisions of
Subsection 8.7, the parties expressly reserve and do not waive or relinquish any
rights, claims, immunities, causes of action, or defenses relating to the presence,
release, or threatened release of Hazardous Substances that either party may have
against the other under federal, state, or local laws, including, but not limited to,
CERCLA, MTCA, and the common law.
(b) This Lease affects no right, claim, immunity, or defense either party may have
against third parties, and the parties expressly reserve all such rights, claims,
immunities, and defenses.
(c) The provisions under this Section 8 do not benefit, or create rights for,third
parties.
(d) The allocations of risks, liabilities, and responsibilities set forth above do not
release either party from, or affect the liability of either party for, claims or
actions by federal, state, or local regulatory agencies concerning Hazardous
Substances.
Form Date: 1/2007 13 Lease No.20-081594
8.9 Cleanup.
(a) If Tenant's act, omission, or breach of obligation under Subsection 8.4 results in a
release of Hazardous Substances, Tenant shall, at Tenant's sole expense, promptly
take all actions necessary or advisable to clean up the Hazardous Substances in
accordance with applicable law. Cleanup actions shall include, without
limitation, removal, containment, and remedial actions.
(b) Tenant's obligation to undertake a cleanup under Section 8 shall be limited to
those instances where the Hazardous Substances exist in amounts that exceed the
threshold limits of any applicable regulatory cleanup standards.
(c) At the State's discretion, Tenant may undertake a cleanup of the Property
pursuant to the Washington State Department of Ecology's Voluntary Cleanup
Program, provided that Tenant cooperates with State (DNR) in development of
cleanup plans. Tenant shall not proceed with Voluntary Cleanup without State
(DNR) approval of final plans. Nothing in the operation of this provision shall be
construed as an agreement by State (DNR)that the Voluntary Cleanup complies
with any laws or with the provisions of this Lease. Tenant's completion of a
Voluntary Cleanup shall not be a release from or waiver of any obligation for
Hazardous Substances under this Lease.
8.10 Sampling by State, Reimbursement, and Split Samples.
(a) State may conduct sampling, tests, audits, surveys, or investigations ("Tests") of
the Property at any time to determine the existence, scope, or effects of Hazardous
Substances.
(b) If such Tests, along with any other information, demonstrate the existence,
release, or threatened release of Hazardous Substances arising out of any action,
inaction, or event described or referred to in Subsection 8.4, above, Tenant shall
promptly reimburse State for all costs associated with such Tests.
(c) State shall not seek reimbursement for any Tests under this Subsection 8.10
unless State provides Tenant written notice of its intent to conduct any Tests at
least thirty (30) calendar days prior to undertaking such Tests, except when such
Tests are in response to an emergency. Tenant shall reimburse State for Tests
performed in response to an emergency if State has provided such notice as is
reasonably practical.
(d) Tenant shall be entitled to obtain split samples of any Test samples obtained by
State, but only if Tenant provides State with written notice requesting such
samples within twenty (20) calendar days of the date Tenant is deemed to have
received notice of State's intent to conduct any non-emergency Tests. Tenant
solely shall bear the additional cost, if any, of split samples. Tenant shall
reimburse State for any additional costs caused by split sampling within thirty
(30) calendar days after State sends Tenant a bill with documentation for such
costs.
(e) Within sixty (60) calendar days of a written request (unless otherwise required
pursuant to Paragraph 8.6(c), above), either party to this Lease shall provide the
other party with validated final data, quality assurance/quality control
information, and chain of custody information, associated with any Tests of the
Form Date: 1/2007 14 Lease No.20-081594
Property performed by or on behalf of State or Tenant. There is no obligation to
provide any analytical summaries or expert opinion work product.
SECTION 9 ASSIGNMENT AND SUBLETTING
9.1 State Consent Required. Tenant shall not sell, convey, mortgage, assign, pledge, sublet,
or otherwise transfer or encumber all or any part of Tenant's interest in this Lease or the Property
without State's prior written consent, which shall not be unreasonably conditioned or withheld.
(a) In determining whether to consent, State may consider, among other items,the
proposed transferee's financial condition, business reputation and experience, the
nature of the proposed transferee's business,the then-current value of the
Property, and such other factors as may reasonably bear upon the suitability of the
transferee as a tenant of the Property. State may refuse its consent to any sale,
conveyance, mortgage, assignment, pledge, sublet, or other transfer or
encumbrance if said transfer will result in a subdivision of the Leasehold. Tenant
shall submit information regarding any proposed transferee to State at least thirty
(34) days prior to the date of the proposed transfer.
(b) State reserves the right to condition its consent upon:
(1) changes in the terms and conditions of this Lease, including, but not
limited to, the Annual Rent; and/or
(2) the agreement of Tenant or transferee to conduct Tests for Hazardous
Substances on the Property or on other property owned or occupied by
Tenant or the transferee.
(c) Each permitted transferee shall assume all obligations under this Lease, including
the payment of rent. No assignment, sublet, or transfer shall release, discharge, or
otherwise affect the liability of Tenant.
(d) State's consent under this Subsection 9.1 does not constitute a waiver of any
claims against Tenant for the violation of any term of this Lease.
9.2 Rent Payments Following Assignment. The acceptance by State of the payment of rent
following an assignment or other transfer shall not constitute consent to any assignment or
transfer.
9.3 Terms of Subleases.
(a) Tenant shall submit the terms of all subleases to State for approval.
(b) All subleases shall meet the following requirements:
(1) The sublease shall be consistent with and subject to all the terms and
conditions of this Lease;
(2) The sublease shall confirm that this Lease shall control if the terms of the
sublease conflict with the terms of this Lease;
(3) The term of the sublease (including any period of time covered by a
renewal option) shall end before the Termination Date of the initial Term
or any renewal term;
Form Date: 1/2007 15 Lease No.20-081594
(4) The sublease shall terminate if this Lease terminates, whether upon
expiration of the Term, failure to exercise an option to renew, cancellation
by State, surrender, or for any other reason;
(5) The subtenant shall receive and acknowledge receipt of a copy of this
Lease;
(6) The sublease shall prohibit the prepayment to Tenant by the subtenant of
more than the annual rent;
(7) The sublease shall identify the rental amount to be paid to Tenant by the
subtenant;
(8) The sublease shall confirm that there is no privity of contract between the
subtenant and State;
(9) The sublease shall require removal of the subtenant's Improvements and
trade fixtures upon termination of the sublease;
(10) The subtenant's permitted use shall be within the Permitted Use
authorized by this Lease; and
(11) The sublease shall require the subtenant to meet all obligations of Tenant
under Section 10, Indemnification, Financial Security Insurance.
9.4 Short-Term Subleases of Moorage Slips. Short-term subleasing of moorage slips for a
term of less than one year does not require State's written consent or approval pursuant to
Subsections 9.1 or 9.3. Tenant shall conform moorage sublease agreements to the sublease
requirements in Subsection 9.3.
SECTION 10 INDEMNITY,FINANCIAL SECURITY, INSURANCE
10.1 Indemnity.
(a) Tenant shall indemnify, defend, and hold State, its employees, officers, and agents
harmless from any and all claims arising out of the use, occupation, or control of
the Property by Tenant, its subtenants, contractors, agents, invitees, guests,
employees, affiliates, licensees, or permittees.
(b) "Claim" as used in this Subsection 10.1 means any financial loss, claim, suit,
action, damages, expenses, fees (including attorneys' fees), penalties, or
judgments attributable to bodily injury, sickness, disease, death, and damages to
tangible property, including, but not limited to, land, aquatic life, and other
natural resources. "Damages to tangible property" includes,but is not limited to,
physical injury to the Property and damages resulting from loss of use of the
Property.
(c) State shall not require Tenant to indemnify, defend, and hold State harmless for
claims that arise solely out of the willful or negligent act of State or State's
elected officials, employees, or agents.
(d) Tenant waives its immunity under Title 51 RCW to the extent it is required to
indemnify, defend, and hold State and its agencies, officials, agents, or employees
harmless.
Form Date: 112007 16 Lease No.20-081594
(e) Section 8, Environmental Liability/Risk Allocation, exclusively shall govern
Tenant's liability to State for Hazardous Substances and its obligation to
indemnify, defend, and hold State harmless for Hazardous Substances.
10.2 Insurance Terms.
(a) Insurance Required.
(1) Alternative for Self-Insured. Tenant certifies that it is self-insured for all
the liability exposures, its self-insurance plan satisfies all State
requirements, and its self-insurance plan provides coverage equal to that
required in this Subsection 10.2 and by Subsection 10.3, Insurance Types
and Limits. Tenant shall provide to State evidence of its status as a self-
insured entity. Upon request by State, Tenant shall provide a written
description of its financial condition and/or the self-insured funding
mechanism. In any case, Tenant shall provide State with at least thirty
(30) days' written notice prior to any material changes to Tenant's self-
insured funding mechanism.
(2) All insurance should be issued by an insurance company or companies
admitted to do business in the State of Washington and have a rating of A-
or better by the most recently published edition of Best's Reports. State's
risk manager shall review and approve any exception before acceptance by
State. If an insurer is not admitted, the insurance policies and procedures
for issuing the insurance policies shall comply with Chapter 48.15 RCW
and 284-15 WAC.
(3) The State of Washington, the Department of Natural Resources, its elected
and appointed officials, agents, and employees shall be named as an
additional insured on all general liability, excess, umbrella, property,
builder's risk, and pollution legal liability insurance policies.
(4) All insurance provided in compliance with this Lease shall be primary as
to any other insurance or self-insurance programs afforded to or
maintained by State.
(b) Waiver.
(1) Tenant waives all rights against State for recovery of damages to the
extent insurance maintained pursuant to this Lease covers these damages.
(2) Except as prohibited by law, Tenant waives all rights of subrogation
against State for recovery of damages to the extent that they are covered
by insurance maintained pursuant to this lease.
(c) Proof of Insurance.
(1) Tenant shall provide State with a certificate(s) of insurance executed by a
duly authorized representative of each insurer, showing compliance with
insurance requirements specified in this Lease and, if requested, copies of
policies to State.
(2) The certificate(s) of insurance shall reference additional insureds and the
Lease number.
Form Date: 1/2007 17 Lease No.20-081594
(3) Receipt of such certificates or policies by State does not constitute
approval by State of the terms of such policies.
(d) State shall be provided written notice before cancellation or non-renewal of any
insurance required by this Lease, in accordance with the following:
(1) Insurers subject to RCW 48.18 (admitted and regulated by the Insurance
Commissioner): If cancellation is due to non-payment of premium, State
shall be given ten(10) days' advance notice of cancellation; otherwise,
State shall be provided forty-five (45) days' advance notice of cancellation
or non-renewal.
(2) Insurers subject to RCW 48.15 (surplus lines): If cancellation is due to
non-payment of premium, State shall be given ten (10) days' advance
notice of cancellation; otherwise, State shall be provided forty-five (45)
days' advance notice of cancellation or non-renewal.
(e) Adjustments in Insurance Coverage.
(1) State may impose changes in the limits of liability for all types of
insurance as it deems necessary.
(2) New or modified insurance coverage shall be in place within thirty(30)
days after State requires changes in the limits of liability.
(f) If Tenant fails to procure and maintain the insurance described above within
fifteen(15) days after Tenant receives a notice to comply from State, at its option,
State shall either:
(1) Deem the failure an Event of Default under Section 14, or
(2) State shall have the right to procure and maintain comparable substitute
insurance and to pay the premiums. Upon demand, Tenant shall pay to
State the full amount paid by State,together with interest at the rate
provided in Subsection 6.2 from the date of State's notice of the
expenditure until Tenant's repayment.
(g) General Terms.
(1) State does not represent that coverage and limits required under this Lease
will be adequate to protect Tenant.
(2) Coverage and limits shall not limit Tenant's liability for indemnification
and reimbursements granted to State under this Lease.
(3) Any insurance proceeds payable by reason of damage or destruction to
property shall be first used to restore the real property covered by this
Lease, then to pay the cost of the reconstruction, then to pay the State any
sums in arrears, and then to Tenant.
10.3 Insurance Types and Limits.
(a) General Liability Insurance.
(1) Tenant shall maintain commercial general liability insurance (CGL) or
marine general liability (MGL) covering claims for bodily injury, personal
injury, or property damage arising on the Property and/or arising out of
Tenant's use, occupation, or control of the Property and, if necessary,
commercial umbrella insurance with a limit of not less than One Million
Dollars ($1,000,000)per each occurrence. If such CGL or MGL insurance
Form Date: V2007 18 Lease No.20-081594
contains aggregate limits,the general aggregate limit shall be at least twice
the "each occurrence" limit. CGL or MGL insurance shall have products-
completed operations aggregate limit of at least two times the "each
occurrence" limit.
(2) CGL insurance shall be written on Insurance Services Office (ISO)
Occurrence Form CG 00 01 (or a substitute form providing equivalent
coverage). All insurance shall cover liability arising out of premises,
operations, independent contractors,products completed operations,
personal injury and advertising injury, and liability assumed under an
insured contract(including the tort liability of another party assumed in a
business contract) and contain separation of insured (cross-liability)
condition.
(3) MGL insurance shall have no exclusions for non-owned watercraft.
(b) Workers' Compensation.
(1) State of Washington Workers' Compensation.
(i) Tenant shall comply with all State of Washington workers'
compensation statutes and regulations. Workers' compensation
coverage shall be provided for all employees of Tenant. Coverage
shall include bodily injury (including death)by accident or disease,
which arises out of or in connection with Tenant's use, occupation,
and control of the Property.
(ii) If Tenant fails to comply with all State of Washington workers'
compensation statutes and regulations and State incurs fines or is
required by law to provide benefits to or obtain coverage for such
employees, Tenant shall indemnify State. Indemnity shall include
all fines; payment of benefits to Tenant, employees, or their heirs
or legal representatives; and the cost of effecting coverage on
behalf of such employees.
(2) Longshore and Harbor Worker's Act. Certain work or services under this
Lease may require insurance coverage for longshore and harbor workers
other than seaman as provided in the Longshore and Harbor Worker's
Compensation Act (33 U.S.C. Section 901 et. seq.). Failure to obtain
coverage in the amount required by law may result in civil and criminal
liabilities. Tenant is fully responsible for ascertaining if such insurance is
required and shall maintain insurance in compliance with this Act. Tenant
is responsible for all civil and criminal liability arising from failure to
maintain such coverage.
(3) Jones Act. Certain work or services under this Lease may require
insurance coverage for seamen injured during employment resulting from
negligence of the owner, master, or fellow crew members as provided in
46 U.S.C. Section 688. Failure to obtain coverage in the amount required
by law may result in civil and criminal liabilities. Tenant is fully
responsible for ascertaining if such insurance is required and shall
maintain insurance in compliance with this Act. Tenant is responsible for
Form Date: 1/2007 19 Lease No.20-081594
all civil and criminal liability arising from failure to maintain such
coverage.
(c) Employer's Liability Insurance. Tenant shall procure employer's liability
insurance, and, if necessary, commercial umbrella liability insurance with limits
not less than One Million Dollars ($1,000,000) each accident for bodily injury by
accident or One Million Dollars ($1,000,000) each employee for bodily injury by
disease.
10.4 Financial Security.
(a) At its own expense, Tenant shall procure and maintain during the Term of this
Lease a corporate security bond or provide other financial security that State, at its
option,may approve ("Security"). The Security shall be in an amount equal to
Zero Dollars ($0.00), which is consistent with RCW 79.105.330, and shall secure
Tenant's performance of its obligations under this Lease, with the exception of
the obligations under Section 8, Environmental Liability/Risk Allocation.
Tenant's failure to maintain the Security in the required amount in force at all
times during the Term of this Lease shall constitute a breach of this Lease.
(b) All Security shall be in a form acceptable to the State.
(1) Bonds should be issued by companies admitted to do business within the
State of Washington and have a rating of A-, Class VII or better, in the
most recently published edition of Best's Reports. State's risk manager
shall review and approve any exception before acceptance by State.
(2) Letters of credit, if approved by State, shall be irrevocable, allow State to
draw funds at will, provide for automatic renewal, and comply with
RCW 62A.5-101, et. seq.
(3) Savings account assignments, if approved by State, shall allow State to
draw funds at will.
(c) Adjustment in Amount of Security.
(1) State may require an adjustment in the amount of Security:
(i) At the same time as revaluation of the Annual Rent,
(ii) As a condition of approval of assignment or sublease of this Lease,
(iii) Upon a material change in the condition or disposition of any
Improvements, or
(iv) Upon a change in the Permitted Use.
(2) Tenant shall deliver a new or modified form of Security to State within
thirty (30) days after State has required adjustment of the amount of the
Security.
(d) Upon any default by Tenant in its obligations under this Lease, State may collect
on the Security to offset the liability of Tenant to State. Collection on the
Security shall not relieve Tenant of liability, shall not limit any of State's other
remedies, and shall not reinstate or cure the default or prevent termination of the
Lease because of the default.
Form Date: 1/2007 20 Lease No.20-081594
SECTION 11 MAINTENANCE AND REPAIR
11.1 State's Repairs. This Lease does not obligate State to make any alterations,
maintenance, replacements, or repairs in, on, or about the Property, or any part thereof, during
the Term.
11.2 Tenant's Repairs, Alteration, Maintenance and Replacement.
(a) Tenant shall, at its sole cost and expense, keep and maintain the Property and all
Improvements (regardless of ownership) in good order and repair, in a clean,
attractive, and safe condition. Tenant's obligations under this Subsection 11.2
shall be in addition to Tenant's obligations under Subsections 2.2 and 3.3 of this
Lease.
(b) Tenant shall, at its sole cost and expense, make any and all additions, repairs,
alterations, maintenance, replacements, or changes to the Property or to any
Improvements on the Property which may be required by any public authority.
(c) Tenant shall make all additions,repairs, alterations, replacements, or changes to
the Property and to any Improvements on the Property in accordance with Section
7, Improvements, above. Section 7 shall govern ownership.
SECTION 12 DAMAGE OR DESTRUCTION
12.1 Notice and Repair.
(a) In the event of any damage to or destruction of the Property or any Improvements,
Tenant shall promptly give written notice to State. Unless otherwise agreed in
writing, Tenant shall promptly reconstruct, repair, or replace the Property and any
Improvements as nearly as possible to its condition immediately prior to the
damage or destruction.
(b) State shall not be deemed to have actual knowledge of the damage or destruction
of the Property or any Improvements without Tenant's written notice.
12.2 State's Waiver of Claim. State does not waive any claims for damage or destruction of
the Property unless State provides written notice to Tenant of each claim waived. No claim is
waived unless State waives with specificity.
12.3 Insurance Proceeds. Tenant's duty to reconstruct,repair, or replace any damage or
destruction of the Property or any Improvements on the Property shall not be conditioned upon
the availability of any insurance proceeds to Tenant from which the cost of repairs may be paid.
The parties shall use insurance proceeds in accordance with Subparagraph 10.2(g)(3).
12.4 Rent in the Event of Damage or Destruction. Unless this Lease is terminated by
mutual agreement, there shall be no abatement or reduction in rent during such reconstruction,
repair, and replacement.
12.5 Default at the Time of Damage or Destruction. In the event Tenant is in default under
the terms of this Lease at the time damage or destruction occurs, State may elect to terminate the
Form Date: 112007 21 Lease No.20-081594
Lease and State shall then have the right to retain any and all insurance proceeds payable as a
result of the damage or destruction.
SECTION 13 CONDEMNATION
13.1 Definitions.
(a) Taking. The term"taking," as used in this Lease, means that an entity authorized
by law exercises the power of eminent domain, either by judgment or settlement
in lieu of judgment, over all or any portion of the Property and any Improvements.
Taking includes any exercise of eminent domain on any portion of the Property
and Improvements that, in the judgment of the State, prevents or renders
impractical the Permitted Use. A total taking occurs when the entire Property is
taken. A partial taking occurs when the taking does not constitute a total taking as
defined above.
(b) Voluntary Conveyance. The terms "total taking" and"partial taking" shall
include a voluntary conveyance, in lieu of formal court proceedings, to any
agency, authority,public utility,person, or corporate entity empowered to
condemn property.
(c) Date of Taking. The term"date of taking" shall mean the date upon which title to
the Property or a portion of the Property passes to and vests in the condemner or
the effective date of any order for possession if issued prior to the date title vests
in the condemner.
13.2 Effect of Taking. If during the Term there shall be a total taking,the leasehold estate of
Tenant in the Property shall terminate as of the date of taking. If this Lease is terminated, in
whole or in part, all rentals and other charges payable by Tenant to State and attributable to the
Property taken shall be paid by Tenant up to the date of taking. If Tenant has pre-paid rent,
Tenant will be entitled to a refund of the pro rata share of the pre-paid rent attributable to the
period after the date of taking. In the event of a partial taking, there shall be a partial abatement
of rent from the date of taking in a percentage equal to the percentage of Property taken.
13.3 Allocation of Award.
(a) In the event of any condemnation,the award shall be allocated between State and
Tenant based upon the ratio of the fair market value of(1) Tenant's leasehold
estate and Tenant-Owned Improvements on the Property and (2) State's interest in
the Property; the reversionary interest in Tenant-Owned Improvements, if any;
and State-Owned Improvements.
(b) In the event of a partial taking, this ratio will be computed on the basis of the
portion of Property or Improvements taken.
(c) If Tenant and State are unable to agree on the allocation, it shall be submitted to
binding arbitration in accordance with the rules of the American Arbitration
Association.
Form Date: 1/2007 22 Lease No.20-081594
SECTION 14 DEFAULT AND REMEDIES
14.1 Default Defined. Tenant shall be in default of this Lease on the occurrence of any of the
following:
(a) Failure to pay Annual Rent or other expenses when due;
(b) Failure to comply with any law, regulation, policy, or order of any lawful
governmental authority;
(c) Failure to comply with any other provision of this Lease;
(d) Proceedings are commenced by or against Tenant under any bankruptcy act or for
the appointment of a trustee or receiver of Tenant's property.
14.2 Tenant's Right to Cure.
(a) A default shall become an event of default ("Event of Default") if Tenant fails to
cure the default within the applicable cure period after State provides Tenant with
written notice of default, which specifies the nature of the default.
(b) The cure period shall be sixty(60) days;
(c) State may elect to deem a default by Tenant as an Event of Default if the default
occurs within six (6) months after a default by Tenant for which State has
provided notice and opportunity to cure. This Paragraph 14.2 is effective
regardless of whether the first and subsequent defaults are of the same nature.
14.3 Remedies.
(a) Upon an Event of Default, State may terminate this Lease and remove Tenant by
summary proceedings or otherwise.
(b) Without terminating this Lease, State may also relet the Property on any terms
and conditions as State in its sole discretion may decide are appropriate.
(1) If State elects to relet, rent received by it shall be applied: (1) to the
payment of any indebtedness other than rent due from Tenant to State; (2)
to the payment of any cost of such reletting; (3)to the payment of the cost
of any alterations and repairs to the Property; and (4)to the payment of
rent and leasehold excise tax due and unpaid under this Lease. State shall
hold and apply any balance to Tenant's future rent as it becomes due.
(2) Tenant shall be responsible for any deficiency created by the reletting
during any month and shall pay the deficiency monthly.
(3) At any time after reletting, State may elect to terminate this Lease for the
previous Event of Default.
(c) State's reentry or repossession of the Property under Paragraph 14.3(b) shall not
be construed as an election to terminate this Lease or cause a forfeiture of rents or
other charges to be paid during the balance of the Term, unless State gives a
written notice of termination to Tenant or termination is decreed by legal
proceedings.
Form Date: 1/2007 23 Lease No.20-081594
SECTION 15 ENTRY BY STATE
State shall have the right to enter the Property at any reasonable hour to inspect for compliance
with the terms of this Lease. State's failure to inspect the Property shall not constitute a waiver
of any rights or remedies under this Lease.
SECTION 16 DISCLAIMER OF QUIET ENJOYMENT
16.1 No Guaranty or Warranty.
(a) State believes that this Lease is consistent with the Public Trust Doctrine and that
none of the third-party interests identified in Paragraph 1.1(b) will materially or
adversely affect Tenant's right of possession and use of the Property, but State
makes no guaranty or warranty to that effect.
(b) State disclaims and Tenant releases State from any claim for breach of any
implied covenant of quiet enjoyment. This disclaimer and release includes, but is
not limited to, interference arising from exercise of rights under the Public Trust
Doctrine; Treaty rights held by Indian Tribes,and the general power and authority
of State and the United States with respect to aquatic lands and navigable waters.
(c) Tenant shall be responsible for determining the extent of its right to possession
and for defending its leasehold interest.
16.2 In the Event of Eviction by Third Party. In the event Tenant is evicted from the
Property by reason of successful assertion of any of the rights of any third party, this Lease shall
terminate as of the date of the eviction. In the event of a partial eviction, Tenant's rent
obligations shall abate as of the date of the partial eviction, in direct proportion to the extent of
the eviction, but in all other respects, this Lease shall remain in full force and effect.
SECTION 17 NOTICE
Any notices required or permitted under this Lease may be personally delivered, delivered by
facsimile machine, or mailed by certified mail, return receipt requested, to the following
addresses or to such other places as the parties may direct in writing from time to time:
State:
DEPARTMENT OF NATURAL RESOURCES
Aquatic Region/Rivers District
PO Box 280
Castle Rock, WA 98611
Tenant:
CITY OF PASCO
PO Box 293
Pasco, WA 99301
Form Date: 1/2007 24 Lease No.20-081594
A notice shall be deemed given and delivered upon personal delivery, upon receipt of a
confirmation report if delivered by facsimile machine,or three (3)days after being mailed as set
forth above, whichever is applicable. All notices must identify the lease number to which the
notice pertains. Notices transmitted by facsimile machine shall state the number of pages
contained in the notice, including the transmittal page, if any.
SECTION 18 MISCELLANEOUS
18.1 Authority. Tenant and the person or persons executing this Lease on behalf of Tenant
represent that Tenant is qualified to do business in the State of Washington, that Tenant has full
right and authority to enter into this Lease, and that each and every person signing on behalf of
Tenant is authorized to do so. Upon State's request, Tenant will provide evidence satisfactory to
State confirming these representations. This Lease is entered into by State pursuant to the
authority granted it in Chapters 79.105 to 79.135 RCW and the Constitution of the State of
Washington.
18.2 Successors and Assigns. This Lease shall be binding upon and inure to the benefit of the
parties, their successors, and assigns.
18.3 Headings. The headings used in this Lease are for convenience only and in no way
define, limit, or extend the scope of this Lease or the intent of any provision.
18.4 Entire Agreement. This Lease, including the exhibits and addenda, if any, contains the
entire agreement of the parties. All prior and contemporaneous agreements, promises,
representations, and statements relating to this transaction or to the Property, if any, are merged
into this Lease.
18.5 Waiver.
(a) The waiver by State of any breach or default of any term, covenant, or condition
of this Lease shall not be deemed a waiver of such term, covenant, or condition;
of any subsequent breach or default of the same; or of any other term, covenant,
or condition of this Lease. State's acceptance of a rental payment shall not be
construed to be a waiver of any preceding or existing breach other than the failure
to pay the particular rental payment that was accepted.
(b) The renewal of the Lease, extension of the Lease, or the issuance of a new lease to
Tenant, shall not constitute waiver of State's ability to pursue any rights or
remedies under the Lease.
18.6 Cumulative Remedies. The rights and remedies of State under this Lease are
cumulative and in addition to all other rights and remedies afforded to State by law or equity or
otherwise.
18.7 Time is of the Essence. TIME IS OF THE ESSENCE as to each and every provision of
this Lease.
Form Date: 112007 25 Lease No.20-081594
18.8 Language. The word"Tenant" as used in this Lease shall be applicable to one or more
persons, as the case may be. The singular shall include the plural, and the neuter shall include
the masculine and feminine. If there is more than one Tenant, their obligations shall be joint and
several. The word "persons,"whenever used, shall include individuals, firms, associations, and
corporations.
18.9 Invalidity. If any provision of this Lease shall prove to be invalid, void, or illegal, it
shall in no way affect, impair, or invalidate any other provision of this Lease.
18.10 Applicable Law and Venue. This Lease shall be interpreted and construed in
accordance with the laws of the State of Washington. Any reference to a statute shall mean that
statute as presently enacted or hereafter amended or superseded. Venue for any action arising
out of or in connection with this Lease shall be in the Superior Court for Thurston County,
Washington.
18.11 Recordation. Tenant shall record this Lease or a memorandum documenting the
existence of this Lease in the county in which the Property is located, at Tenant's sole expense.
The memorandum shall contain, at a minimum, the Property description, the names of the parties
to the Lease, the State's lease number, and the duration of the Lease. Tenant shall provide State
with recording information, including the date of recordation and file number. Tenant shall have
thirty(30) days from the date of delivery of the final executed agreement to comply with the
requirements of this Subsection 18.11. If Tenant fails to record this Lease, State may record it
and Tenant shall pay the costs of recording upon State's demand.
18.12 Modification. Any modification of this Lease must be in writing and signed by the
parties. Oral representations or statements shall not bind either party.
Form Date; 1/2007 26 Lease No.20-081594
18.13 Survival. Any obligations of Tenant which are not fully performed upon termination of
this Lease shall not cease, but shall continue as obligations until fully performed.
THIS AGREEMENT requires the signature of all parties and is executed as of the date of the last
signature below.
CITY OF P CO
Dated: , 20 "'4 04.r�
By: JO CE OLSON
Title: J M or
Address: PO Box 293
Pasco, WA 99301
STATE OF WASHINGTON
DEPARTMENT OF NATURAL RESOURCES
Dated: &) Z 20C K
By: S OTT T. ROBINSON
.�.•.• -- e% �Title: Assistant Region Manager
G�: a► 1
• .o ddress: PO Box 280
Castle Rock, WA 98611
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Standard Aquatic Land § 00000000 •'
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Approved as to Form on aryl 9, 2
By: Janis Snoey
Assistant Attorney General
State of Washington
Form Date: 1/2007 27 Lease No.20-081594
REPRESENTATIVE ACKNOWLEDGMENT
STATE OF WASHINGTON )
ss
County of Franklin )
I certify that I know or have satisfactory evidence that JOYCE OLSON is the person who
appeared before me, and said person acknowledged that (he/she) signed this instrument, on oath
stated that (he/she) was authorized to execute the instrument and acknowledged it as the Mayor
of City of Pasco to be the free and voluntary act of such party for the uses and purposes
mentioned in the instrument.
Dated: I f?i`ZI0'F
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(Signature) jV
(Aeler�sta} )
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My appointment expires
Form Date: 112007 2$ Lease No.20-081594
STATE ACKNOWLEDGMENT
STATE OF WASHINGTON )
) ss
County of Lewis )
I certify that I know or have satisfactory evidence that SCOTT T. ROBINSON is the person who
appeared before me, and said person acknowledged that (he/she) signed this instrument, on oath
stated that(he/she) was authorized to execute the instrument and acknowledged it as the
Assistant Region Manager of the Department of Natural Resources,to be the free and voluntary
act of such party for the uses and purposes mentioned in the instrument.
Dated:
(Signature)
(Seal or stamp)
(Print Name) L
Notary Public in and for the State of
Washington, residing
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Plan of Operations and Maintenance
Chiawana Park Boat Dock
Agreement#20-081594
Prepared by Administrative and Community Service Department
City of Pasco, Washington
Site Description:
Location of dock: Columbia River, north bank, Franklin County, Section 20, Township 9,North
Range 29E, West Meridian. The project is the replacement of an existing boat dock at Chiawana
Park on Lake Wallula, Columbia River, Pasco, Washington.
The upland property(180 acres) is owned by the U.S. Army Corps of Engineers (COE)
administered by the Walla Walla District. The City of Pasco intends to lease the park from the
COE for a 25 year period and will thus be responsible for the operation and maintenance of the
restrooms, lawn, access roads and parking areas, a paved pedestrian/bike path, and out buildings
including a caretaker residence park and boat dock.
History:
In 1968 the dock and park property was leased by Franklin County from the COE until Franklin
County terminated its lease in December 2005. The original dock facility has been in place for
several years and was installed by Franklin County. In 2007, during the course of negotiations
for the lease between the City of Pasco and Corps of Engineers, damage to the dock was noted.
The COE agreed to replace the dock if the City provided % of the replacement funding. During
the course of the COE's due diligence in permitting the replacement facility, it was noted that a
portion of the dock was over Washington State lands.
Future Use and Condition:
The use is to remain the same to provide access for public use and recreation. The dock facility
will follow Best Management Practices (BMPs) and is being repaired and upgraded that include
ADA accessibility and light penetration standards to meet fish habitat standards. The park is
open to the public on a seasonal basis, typically from April through October of each year. A boat
launch located at the east end of the park, approximately 1/4 mile from the dock facility, is open
year-round and is not located on State Owned Aquatic Land (SOAL).
Development Plan and Maintenance:
The dock will be inspected monthly by city facilities staff and, if found to be in need of repair,
will be repaired as soon as practical unless public safety were a concern and at that point the
repair would be done immediately or the area would be closed off to the public until such time
the repair is completed. The regulatory authorities have not issued permits to date but it is the
intent that all work windows and conditions set forth will be followed. The dock upgrades will
begin when operational windows allow in late 2007 and should be completed early in 2008;
more specifically December 15, 2007 and completed by February 28, 2008.
BUELLD Page 1 of 2 12/17/2007
Operations:
Chiawana Park and the dock will be operated on a seasonal basis, open to the general public, at
no charge. There is no fueling on the dock, no commercial activity,no waste discharges and no
overnight camping at the facility or the park.
DNR will provide to lessee a supply of`Enjoy your Washington State-Owned Aquatic Lands"
and"Spills Aren't Slick" signs with emergency spill contact information for lessee to post at this
lease site.
Contact Information:
City of Pasco
Facilities Manager
(Currently: Dan Dotta)
Email: dottad@a,pasco-wa.gov
PO Box 293
Pasco WA 99301
(509) 543-5757
Department of Natural Resources
Dave Harsh, Aquatic Land Manager
mailto:dave.harsh(a)dnr.wa.gov
PO Box 280
Castle Rock WA 98611
(509)220-3009
BUELLD Page 2 of 2 12/17/2007