HomeMy WebLinkAbout2018.03.26 Council Special Meeting PacketSpecial Meeting
AGENDA
PASCO CITY COUNCIL
7:00 p.m.
March 26, 2018
Page
1. CALL TO ORDER:
2. ROLL CALL:
(a) Pledge of Allegiance
3. NEW BUSINESS:
2 - 9 (a) * Addendum No. 1 to the Boat Basin Sub-lease Agreement
MOTION: I move to approve Addendum No. 1 to the Boat Basin Sub-
Lease Agreement with JT&T, LLC, dba Columbia Marine Center (CMC)
and, further authorize the City Manager to execute the agreement.
4. ADJOURNMENT.
Page 1 of 9
AGENDA REPORT
FOR: City Council March 22, 2018
TO: Dave Zabell, City Manager Special Meeting: 3/26/18
FROM: Rick Terway, Interim Director
Public Works
SUBJECT: Addendum No. 1 to the Boat Basin Sub-Lease Agreement
I. REFERENCE(S):
Addendum No. 1 to the Boat Basin Sub-Lease Agreement
II. ACTION REQUESTED OF COUNCIL / STAFF RECOMMENDATIONS:
MOTION: I move to approve Addendum No. 1 to the Boat Basin Sub-Lease
Agreement with JT&T, LLC, dba Columbia Marine Center (CMC) and, further
authorize the City Manager to execute the agreement.
III. FISCAL IMPACT:
$25,000 from the Marina Fund
IV. HISTORY AND FACTS BRIEF:
As part of the property leased by the City from the Army Corp of Engineers,
the City sub-leases the Boat Basin to Columbia Marine Center (CMC). During
the winter of 2016-2017, heavy snow caused the A dock at the marina to fail.
The dock was constructed, out of wood, in the late forties. It has taken a
considerable amount of time to get the dock permitted through the USACE,
which was finally granted mid-February 2018.
V. DISCUSSION:
This brings us to 2018. The required construction of the dock has changed
drastically; poly floats instead of foam, light penetrating deck instead of wood.
In fact, no wood is allowed in the construction of the new dock; only steel and
recycled materials. Also, in the covered areas, it is required that sauna tubes
must be installed to get light down to the water. This increases the cost to
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replace the dock substantially.
The total cost of the new dock is $1,394,944.08, including miscellaneous costs
and contingencies. As part of the lease requirements, CMC had the ol d dock
insured for $605,000, which will be used, in part, to remove the old dock and to
fund the a portion of the new dock. The remainder of fund will be covered by
the City’s insurance less the deductible of $25,000.
It is important the project moves forward expeditiously for two reasons; first, to
get the dock installed and available for use this season and, second, to lock in
the contract should steel prices go up with the proposed tariffs, which could
add 25% to the cost of steel.
Attached is Addendum No. 1 to the Sub-Lease Agreement, which includes a
significant increase in the rent and an extension of the lease terms. The lease
also provides for CMC to make improvements to the facility, most notably with
an automatic entrance gate which will assi st the fire department in quicker
access to the fire boat moored at the facility.
Staff recommends approval of Addendum No 1 to the Boat Basin Sub -Lease
Agreement with JT&T, LLC, dba Columbia Marine Center (CMC) and, further
authorize the City Manager to execute the agreement.
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Addendum No. 1
Boat Basin Sublease Agreement - 1
ADDENDUM NO. 1
BOAT BASIN SUBLEASE AGREEMENT
(Replacement Docks)
THIS ADDENDUM dated this ____ day of April, 2018, by and between the City of
Pasco, a Washington Municipal Corporation, hereinafter referred to as “City”, and JT&T, LLC, a
Washington Limited Liability Company, doing business as Columbia Marine Center, hereinafter
referred to as “Columbia.”
WHEREAS, the Parties have entered into the Boat Basin Sublease Agreement on,
December 15, 2012, providing Columbia lease of the premises known as the “Pasco Boat Basin”
including its slip covered docks referred to therein as “slip docks”; and
WHEREAS, during the winter of 2016-2017, severe winter conditions resulted in the
declaration of an emergency resulting in catastrophic damage to the slip docks rendering them
destroyed; and
WHEREAS, it is the desire of the City and Columbia to replace the destroyed docks
allocating their respective responsibilities and interest in said replacement docks by this
Addendum. NOW, THEREFORE,
IN CONSIDERATION of the mutual covenants contained herein, the Parties agree to
amend the Boat Basin Sublease Agreement as follows:
Section 1. Article 16 – Replacement Docks shall be and hereby is created and shall
read as follow:
ARTICLE 16 – REPLACEMENT DOCKS
16.1 Columbia’s Responsibilities.
A. Columbia shall procure and have delivered onsite to the Pasco Boat Basin,
Pasco, Franklin County, Washington, and shall install replacements of the 40 covered slip
docks, meeting the specifications as attached hereto and incorporated herein as Exhibit 1.
B. Remove and appropriately dispose of the remains and debris of the
destroyed 40 slip covered docks.
C. Secure the necessary permitting and cover the costs of installation for pier
pilings necessary to accommodate the replacement docks, as provided in Exhibit 1 above.
D. All costs for such replacement, fabrication, transport, pilings, installation
and all other costs associated with the replacement docks shall be borne by Columbia in
the amount of $605,000.00. To the extent available, all insurance proceeds available to
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Addendum No. 1
Boat Basin Sublease Agreement - 2
Columbia under Article 7 “Insurance” of the Boat Basin Sublease Agreement, shall be
applied to the replacement of the docks.
16.2 City’s Responsibilities.
A. Shall expedite and promptly process all City licenses and city permits
necessary for the installation of the replacement docks.
B. Shall reimburse Columbia for its actual costs of the removal, replacement
and installation of the replacement docks as identified in Section 16.1 above at the Pasco
Boat Basin in an amount not to exceed $744,341.08, (which is the difference between the
amount of the anticipated dock replacement contract cost ($1,242,496.08), plus
miscellaneous costs and contingencies, which costs are estimated to be $1,394,944.08)
and the amount to be payable by Columbia. City shall reimburse Columbia upon
completion of installation and acceptance by the City and Corps of Engineers as stated
herein. In the event that total costs exceed $1,394,944.08, the parties shall meet in good
faith to determine how excess costs are to be paid.
C. Shall expeditiously pursue and secure the approval of the United States
Department of the Army Corps of Engineers of the replacement docks under Section 6
“Structures and Equipment” of the Lease to the City of Pasco, Washington (Lease No.
W912EF-1-04-13).
16.3 Upon acceptance by the City and Corps of Engineers, the replacement docks
provided herein shall become and be a part of the Boat Basin’s Sublease Agreement as property
of the City, subject to the exclusive control and possession of Columbia, including the rights of
all rents, profits, and revenues generated from the use thereof during the term of the Sublease
Agreement.
16.4 Upon termination or expiration of the Boat Basin Sublease Agreement, and any
extensions thereof, the replacement docks shall remain as a part of the City’s boat basin
complex, as property of the City, without any further compensation.
16.5 For the purpose of this Addendum, time is of the essence. The parties recognize
the limited time available for construction of essential elements of the replacement docks within
the Columbia River and, therefore, shall exert best efforts to promptly perform each party’s
responsibilities under this Article 16, and provide such cooperation as necessary to accomplish
the installation of the replacement docks.
Section 2. Article 3, Section 3.1, entitled “Initial Term” shall be and hereby is
amended and shall read as follows:
3.1 Initial Term. This Sublease shall commence on the 15th day of
December, 2012, and shall end at midnight on December 31, 2028, unless
extended as hereinafter provided or unless earlier terminated.
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Addendum No. 1
Boat Basin Sublease Agreement - 3
Section 3. Article 4, Section 4.2 entitled “Rent” shall be and hereby is amended and
shall read as follows:
4.2 Rent. Commencing on January 1, 2013, the monthly rental amount
shall be One Thousand Two Hundred Dollars ($1,200.00); commencing on
January 1, 2014, the monthly rental amount shall be One Thousand Three
Hundred Dollars ($1,300.00); commencing on January 1, 2015, the monthly rental
amount shall be One Thousand Four Hundred Dollars ($1,400.00); the current
monthly rental amount is One Thousand Six Hundred Twenty Dollars and 68/100
($1,620.68); and commencing on May 1, 2018, the rental amount shall be Two
Thousand Four Hundred Dollars ($2,400.00) through April 30, 2023 after which
the rental amount will increase by 2 percent per annum through the remainder of
the initial term as identified in Section 3.1 above.
Section 4. Article 7, Section 7.2, entitled “Fire and Casualty Insurance” shall be and
hereby is amended and shall read as follows:
7.2 Fire and Casualty Insurance. Columbia, as an operating expense,
shall maintain and keep on all of its personal property, improvements, and
alterations, in, on or about the Premises, including, but not limited to, buildings,
structures, and other improvements thereon, a policy of standard fire, casualty,
and extended or other coverage insurance to the extent of 100% of their full
replacement value, without reduction for depreciation of Columbia’s
improvements or alterations if damaged, with the loss payable to the City and
Columbia as their interest may appear. The City shall maintain and keep on its
docks (open and covered), including improvements and alterations with the
Premises, a policy of standard fire, casualty, and extended or other coverage
insurance to the extent of 100% of their full replacement value, without reduction
for depreciation of the City’s improvements or alterations if damaged, and shall
apply such proceeds for the reconstruction of the damaged dock.
Section 5. Article 5, entitled “Remediation and Capital Development Plan” shall be
amended to include a new section 5.4, so read as follows:
5.4 During the remainder of this lease, Columbia, at its own expense,
will perform the improvements as provided in in Exhibit F, attached hereto and
incorporated by this reference.
Section 6. Remaining Terms and Conditions. Except to the extent as modified above
by Article 16 regarding the replacement docks, as affecting Article 12.1.B “Alterations,
Improvements and Changes Permitted”; Article 12.1.D. “Disposition of New Improvements; and
Article 12.1.E; and as amended by Sections 2, 3, 4 and 5 above, all remaining terms and
conditions of the Boat Basin Sublease Agreement of March 7, 2013, shall remain in full force
and effect. To the extent as modified by this Addendum, Exhibit B “Inventory” and Exhibit E
“Capital Development Plan” (and its supplement thereto) are amended consistent herewith.
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Addendum No. 1
Boat Basin Sublease Agreement - 4
Section 7. This Addendum shall take full force and effect on the 1st day of May,
2018.
IN WITNESS WHEREOF, the Parties have hereunto set their hands as of the date first
written above.
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Addendum No. 1
Boat Basin Sublease Agreement - 5
CITY OF PASCO JT&T, LLC
d/b/a Columbia Marine Center
By. ______________________________ By: ______________________________
Dave Zabell, City Manager James Toroni, President
APPROVED AS TO FORM: APPROVED AS TO FORM:
By. ______________________________ By: ______________________________
Leland B. Kerr, City Attorney Brent Dille, Attorney for JT&T, LLC
STATE OF WASHINGTON )
:ss
County of Franklin )
On this day personally appeared before me DAVE ZABELL, City Manager for the City
of Pasco, Washington, described in and who executed the within and foregoing instrument, and
acknowledged that he signed the same as his free and voluntary act and deed for the uses and
purposes therein mentioned.
GIVEN under my hand and official seal this _____ day of ___________________, 2018.
_________________________________________
Notary Public in and for the State of Washington
Residing at ________________________________
My Commission Expires _____________________
STATE OF WASHINGTON )
:ss
County of Franklin )
On this day personally appeared before me J AMES TORONI, President of JT&T, LLC,
d/b/a Columbia Marine Center, described in and who executed the within and foregoing
instrument, and acknowledged that he signed the same as his free and voluntary act and deed for
the uses and purposes therein mentioned.
GIVEN under my hand and official seal this _____ day of ___________________, 2018.
_________________________________________
Notary Public in and for the State of Washington
Residing at ________________________________
My Commission Expires _____________________
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Addendum No. 1
Boat Basin Sublease Agreement - 6
EXHIBIT F
Install video surveillance for security.
Landscaping the point to the right of the building and putting dedicated parking in for the fire
department.
Landscape the left side of the building along the side.
Install electric front sliding gate for access to the marina with security codes, cards, fobs.
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