HomeMy WebLinkAboutMiddleton Six Sons Farm Letter of IntentCITY MANAGER (509) 545-3404 / Fax (509) 545-3403
P.O. Box 293, (525 North 3rd Avenue) Pasco, Washington 99301 / www.pasco-wa.gov
July 13, 2012 lel
Bill Middleton
Middleton Six Sons Farm
1441 Pasco Kahlotus Road
Pasco, WA 99301
RE: BOR Quarter Section (N W4, 514, T9, R30)
Dear Mr. Middleton:
This correspondence is intended to memorialize the verbal agreement we have reached over the
course of the past month regarding the above -referenced land sale by the United States Bureau of
Reclamation (BOR). To avoid any misunderstanding, the agreement outlined below is intended
to replace the offer made to you in the City's letter dated June 8, 2012 and to provide the basis
for a formal agreement between you and the City.
Subject to the City's successful purchase of the BOR quarter section, the parties (City and
Middleton) agree:
• The City will lease the subject site to Middleton for a period of 30 years (in the form of
three consecutive ten-year lease agreements) each at Middleton's option, subject to the
first year market rent as determined by the City and thereafter at intervals not to exceed
three years for approved perennial crops and annually for other crops.
• The City will lease to Middleton its existing farm circles, numbered 1 through 5, for ten
years, subject to market rent as determined by the City at intervals not to exceed three
years for approved perennial crops and annually for other crops.
• The above leases will be subject to Middleton's continuing good standing as to key lease
provisions including, but not limited to, consistent compliance with operational
requirements of the City's farm management plan.
• The initial ten-year lease for the BOR quarter section will include a "development
obligation" which requires Middleton to fully prepare the land for pivot -irrigated crop
production, including any necessary land clearing and leveling as well as purchase and
installation of all irrigation components (center pivot machine, underground piping and
electrical components — controller, wiring and switch gear), including appropriate piping
for pressurized water to be supplied from the City's system on Section 11, T9, R30. In
full consideration for fulfillment of this obligation, Middleton will receive an annual
credit of $20,000 against the rent otherwise due the City each year of the initial ten-year
lease.
Bill Middleton
July 13, 2012
RE: Bureau of Reclamation Quarter Section
Page 2
City will grant Middleton first right to purchase the BOR quarter section, at its appraised
value, if the City were to sell the property at any time in the future.
City will sell to Middleton for $900/acre certain "corners," each less than ten acres and
mutually agreed as to boundaries, as specified below with the restriction that no
residential structure/use will be placed or maintained on said comers:
o The SW, SE and NE corners of the NW 1/4, Section 14, T9, R30;
o The southeast comer of Section 11, T9, R30.
Please affix your signature hereunder to reflect your concurrence with the foregoing elements of
agreement. Upon its receipt, I will direct the City's attorney to prepare the formal agreement for
presentation to you and the Pasco City Council for final approval.
Manager
GC/tlz
cc: City Council
Lee err
ad Qayoumi
Henry Johnson
Concurrence:
Bill Middleton
Date