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Home My WebLink About1999 09-28~.. 1 ~'/e,~~-~. /~tj~y h ~~ ~ ~ ~~~ I~pw~~ h { ! 4t ,~J• ix~ ~ ~ ~-,, ~~ ~ ~~~ cry ca ~~rc~c. s rya rFa~a ~c~a ~N«v~ sF~sionr TUFSDA Y, 5B`PTE>V1BFR 28, ~ 999 at 6:30 P~1 Cl TY C~ ClNC1L Cf~,4 MB~RS Issue #7 Discuss the request for funds for Boise Metro Economic Q~r2e~-ne~~ ~ Development Counci with the Chamber of Commerce. Issue #2 Discuss with the Human Resource Director the issue of the raises for employees and the time frame in which they receive it. Gui~l G~~s'uc s f o~- Dr~fi 5~ L--~Ce ~.u~iue ft~ sl'i~iJ Issue #3 Update on the Golf Course Clubhouse concerning the Letter of Credit. Issue #4 Discuss the proposed new solid waste ordinance. Q~feti h.ec~- c~o~Pe ~-,~dlz~ ~~-rvv~r.2. ,~ s L.e~r,~-2 ~e%-v~~~ /ar~,~ Ua a,.z ~ ~, ~`~ ~ ~-~-ed-~~-fig,.., ~;~.,1.~~.zv~, - v~ ~~~ o~~~:, l As a-,...~ ud~ c~ 7; ¢s Prti r ._., 1` HUB OF TREASURE VALLEY ~ Mayor ' ROBERT D. CDRRIE A Good Place to Live City Council Members CHARLES ROUNTREE 33 EAST IDAHO GLENN BENTLEY MERIDIAN, IDAHO 53642 RON ANDERSON (2QS} 858-4433 • Fax ~~08} 887-4$13 KEITH BIRD City Clerk Fax (208} 8$8-4~ 18 NOTICE of SPECIAL 1NORK~HoP LEGAL DEPARTMENT (208) 28$-249 • Fax ?88-250I PUBLIC WORKS BUILDING DEPARTMENT (208} 887-22I t • Fax 887-127 PLANNING AND ZONING DEPARTMENT (208} 884-SS33 • Faz 887-1 X97 NOTICE IS HEREBY GIVEN that the City Council of the City of Meridian will hold a Special Workshop at City Hall, 33 East Idaho, Meridian, Idaho, on Tuesday, September 28, ~ 999 at 5:38 P.M. The Meridian City Council will be discussing strategic planning for the City of Meridian. The public is welcome to attend. DATED this 24th day of September, ~ 999. '~~~~~~~ritr~~~7rr11~,~~ ~~ ~ ~ f~ ~x ~ ~ ry * ~J ~~ .~ ~ ~ ~ c~ ~ ~. ~ Gr ~+ ,~„ r w y ~~.L W w ~ ~ r p ~~ C~ .. (~ '1~ ~ ~~~ '~~ ~ T ~ ~~ ' ~~~ f ti ~ ~ t r'1 ~ \ rf~~1111frd6 it111111~~1 iG~'~-~--'~ WILLIAM G. BERG, JR. - ITY CLERK vti..r c.. r i JJ J. 1 • ~l I~IU ~ VU,~ ~' . U~ rr,. I U~ S ~ ~T R~ ._„w.. ~C~NUMIC D~LUPM~N~T C~UI~CYi, A Ui-ar~r+ rr t~ir RnxF lacr~n Gt~wDc W Qrr,tiu~ ~~~~~ ~ ~ ~ ~ ~ ~~~ CITY Cr 1'IF;YIi~L~iti TREASURE VALL~;Y MET~tU ECONOMIC DEVELOPMENT Organ~za~~an, Iv~arket~n Inc or#~~ ~} p g ~ ~'und~~g Pro osed ~~~ a~ai~,atiuri • `l'he proposed approach is to ask each cntit to 'oin the Bois Y .~ e Metro FJconomzc Dcvclop~~~ent Ccunca 1. ~~~..~~. ,~ i • The Mayo~~s of Caldwell axed Nam a would be a c ` . . p sk d to ~o~n the Mayors of ~otse, ~;agle, Garden ~:ity, K,una and Nlcridian to ' ~ ,? sxt on tl~e l~M~~I~C, s Executive Co~nmitfiee govcrn~ng board as ex offici v ' o, ot~ng ,members. ~'he chdanher cif cpmmcrcc or the local economic dev e~oprnent represcntat~ves whichever one is responsible fox local economic dev cloprnent}would also have one pers~t~ represented on the BME]~C Exec . ut~ve Camm~ttee as a voting mernher, • a pcrson fron~ each entit~~ would be dcsi natcd as the ri for handl' ~ ~ p nary contact Ong site location requests for their co~nmun~t . Y • 7'hesc rcpreye~~tatives would form the economic Dc~relopmea~t Team ~~,~'~`~, • 't'his person would also serve on the l"3MEDC's Ne ' . w B ustness Attraction Subcommittee. This Subcommittee averse es the ~M1/D~ s extexxxal xr~arkeiing pxc~~~~n, l_;xtcr~~al M~rke~i~, • Uur purpose in joining together, into a metro or ~ ~. gan~zat~on, ~s to max~m~re our l~mxted resources by market~~,g and responding to businesses conside ' ring the area as a poten~al location. • Forms of marketing would include; direct mark ' etxng, ad~~ert~sang ~n selected publications, attending ~•ade shows, etc. • This marketing would be done with materials dev eloped to highlaght the area its various C01]1mu~aitaes. SEP 27 '99 121? 2088582817 PRGE.02 ` - 4, Orgari;~rion, Mar~~cting, ~ ~~ng, & r~unding June 1~9g ..~~- ~~ ~ ~~ ~l •~F1 !4U UU1 1~u~ `. • Fxcept foi~ materials generated to Iu hIi lit the uni g g ~~ueness of each con~~a~u~~zt}~, materials used fox response to a prospect would be tf~ose developed by tl~e 13oisc N1ctz~o F,conoinic llcvclo n~ea~t Couzacil ' . ~ , ~nClUding the l"Cg~pl~~.l data profile, Ilecrslatr Resr}urges. • These materials, including the .~ecrsror~ ~4esu~rr ces would be available to each entity to resporxd to hose inquiries that co~~~e air eGtly to them, when a company is only interested in their cornmun' xty. Re o~~an & ~oinmt,nicatic3ns ~ Tlae BCOnomiC DCVelop~r~ept 's'eam EDT ~vc~uld ( ~ meet monthly to discuss and review pruspec;t inquiries received during the previous month-~~- ~ ~ .~ ~M those that c.a.me to the FCC ilia those that Dame directl to each emit Y y. ~nfcyrmation discussed in these nacctin s will be m ' . g a~nta~ned can~dential, as prospect campanics do r~c~i want their puns made ublic. F ~ Mach jurisdiction will reoeive a quartcrl l~riefin ~~ Y g o external marketing acuv~t~ew, prospect responses ilia prospect visits ry their EDT member and tl~e -, ~'residcnt. ~Ml~•1~~ dice l~c3le.~ & ales onsibilitics • The purpose of the BMEDC is to: • market the region to generate qualified ros cots in Indus .. p P tar cted industries and try cl us iers, arid, • leverage private and public allies and resource s to locate quaffeel prospects, improve the region's competitiveness, and maintain a d sty nng, viable regional (zz~GLrv} eet~~~amy, ~ whi Ie retention and cxpanSian of existin bus' ' 13ML g triers is primarily a local issue, the ~DC wxll work closely with its members to condu Gt Selected rotGn~i4n and expansion projects, • The Boise Metro Eco~~o~mic Develo meet C ' p ounc~l will: • design and implement adverkisin and marketit g i$ programs to delivex the messages of opportuj~ities in the region and to enhance the ' • Plan and executes cca I region s Image. p a events to at~:act special visitors whose opinions are considered when it corner to business locataozt d an business formation. • Develop ctillateral materials that communicate t e h advantages Qf our region to businesses in key Gconc~x~ic itidustrirs acid . . c.lu.5t~rs. • with Economic ~Uevelopment Team ~~` war (E }, k to update and identir targeted industries and economic cln t y s err. 2 SEP 27 ' 99 ~.2 ~ ~? ~~IAAAA~A1'7 onrc r~~ • ~ ' 0€~~r~iraiio~, Mtuketing, ~ .Eing, & ~`~uriding ~unc1999 r~ work conti~~~iously with the L•'ll`l` to i1a~ rove ht~w leac~.~ Dandled P end prospects arc ,and to ~l~crease the i~umbei• and qualit of succcssfu] 1 Y ocat~ons, • Me~nitor and track the a~un~her of uali~ied ros ects-- . tl ~ p F which iiacludcs visits to ~e region. • Participate in selected trade shows, includin ED g T rnemhers, + Advertise in selected targeted Indus ublicatio ~"Y p ns. • Conduct and update regional metro labo~~ mar e • ~ k t analysis, • As an adjunct, research and prepare a re aonal wor g kforcc nc~cds assCSSrnent, + Develop the capability conductan re ianal im a $ , g g pct analysis. uild a web site that allows the EM~D~ artnez•s to . p fuliy access the regional ec4nomlc dcvclapment data base, • ]~;ach entity member will: • respond tQ ~~equests fro~n the $MEl)~ within a s ecified ti p me frame, detertnincd by the pz~ospect, if the emit wishes tc~ c ~ . y c}mpete a~~d ~f the lead ~s appropriate for the city, • The city ar entity will provide its res oast; in a f ar~~n• `~intl ~ at developed ,] y by tht; EDT and $M$~C, • 'l'he city or entity will arrange for local h,os italic p y, tour s and h~~e~~ags l+'or prospects visiting sites in the city. ' 7~ac city or entity will proyidc an official ccanonaic v de eloprnent desiglZee to represent the city on the Ec;a~~t~mic bevel ' . opment 1 eam ~~D`l'~. • The city ar entity will cooperate in im lementin t th P g he BMEDCIEDT process at includes: • common presentation formats; • exchanging inforn~atic}n on prospects with the 13M1; DC staff, • the u4e of shared data syste~nsa • land and building data bases; and, • private sector real estate i~adustry interfaces. • At its drscretia~~, each entity, if it has them is e»cc~ - . iua~ed tc~ provide a copy of acs nwt~ approvi;d c;cunumic development strate ies work r evaluation criteri g ~ p o~rarn and a to the $M~f]C managment. The BMEDC will not di • , . this information to a sclose then partaCZpants In the ~MLUC,. • The city ~r entity a~rccd to reco ize the $M~ ~ ~ s . ~ nC as the city s or entity s officially designated regiana~ economic develo m p ent organ~~.at~aza for marketing the Boise metro region, Fu~~ • Obviously, al] this work tames with a cost. zt is to our mutual advantage to dec7de on the level o:C financial participation that is desirable and possible for each city or entity. 3 SEP 27 '99 ~2~~8 208888817 PAGE. 04 . . drga~nix~l.icm, Merkctin ~~ i~ri, & 6, ~ ~~~ding ]uric ~ 9~9 + Boise pity and Ada Cauniy invest $3Q flDD a lea ' a } r >>~ the ~MLllC,. Nel~her ~.S based o~~ a !'oi~mula. ~7d~l~o Falls, foz• exarr~ le invests SO p $ ,oao per yew lil its ESC,) • Perhaps a beginning point for con~mun~ties w auld be as follows; Caldwcll$ l O,DaD + Meridian $ ~ a,4ti4 • ~~~pa ~ ~ o,ooa • eagle $7,S~D • Carden City $?,SDO • Kuna $?,5~4 The ~I~.F:ll(: has five individual annual fundi ng levels. Platinum--$7,S~D and above • Gola--$s,ooD - ~7,4~~ • S~lve~~.~$3,QD0 - $4,99 • $ron;ce.-$I,SOQ - $x,999 + l~finerald--~5~4 - $1,499 4 SEP 27 '99 12:9 20888828? PAGE, 05 2~5 E. Franklin Raad, p,p, Box 7 ~ Mearid~an Ida J[~y 1`"as~ BV Y~irV ~* ~ F , ho 836$a ax X208} 888-2fi82 SATE; September Z7, X999 T~: ~V~ll Berk, City Caerk ~~~: Teri Sackm~n, N~erx~ian Chamber of Cammer~e ~~ lafonxa~t~oq requested ~ ~~ pages ~ac~udwg this cover sheep: 5 SEP ~7 ' 99 ~. 2 : ~ 6 ~0888828~7 PAGE.O~ 215 E. Franklin Raad, P,O. Box 7 ~ Meridian, Zdahv 83680 X208} 888-2817 ~ Fax ~208~ $S8-~fi8~ REcErvED SEP 2 1 1999 CIT`I OF MERIDIAN September Z 1, l 999 Mayor Bob Came Councilmen Rountree Counc~iman Bentley Councilman Anderson Councilman Bud City of 1~eridian 3 3 E. Idaho Meridian, ID 8364 Dear Mayor & City Council Members, At a meeting of the Meridian Chamber of Commerce Board of Directors held on September 17z 1999, it was approved to invest Five Thousand Dollars $5 044 towards ~ } the efforts of the Boise Mefro Economic Development Council BMEDC . It was the . ~ ~ feehng of the Board that th7s ~s a warthwlule cause anal is un octant to the owth and P ~ development of the City of Meridian. The B11r~DC had re uested Ten Thousand Dollars 1Q ~ ~ ~ ~ q ~~ ,444} to came from the Meridian community. Zt Ys the ho e of the Board that the .. ~ P City of Mendxan will match the contnbut~on and 1o~n with the Chamber in sir actin the BMEDC. The PP g Chamber has completed extensive work m the area of econanuc development and would like to continue movie in the direction of the fu g ire development. If you have any questions please feel free to contact me at 8S$~9594 or the Chamber office at S S 8-2 817. Thank you for your tune and consideration of this matter. Sincerely, Doug B eehler President cc: Will Berg SEP 21 ' 99 18 23 ~~8 884 585 PAGE . ~ ~ ~]HITE, PETERSON, PRUSS, MORROW ~ ~IGRAY, P.A. ATTORNEY5 AT LAw ]U5~'[N P. AYLSWOATH PHILIP A. PETERSON KATHY J. EDWAADS STEPHEN I.. PRUSS ~ULIE KLEIN FISCHER ERIC S. R05SMAN WM. F VIGRAY, III TODn A. ROSSMAN D. SAMUEL ]OHN5QN R. STEPHEN RUTHERFORD WILLIAM A. MORROW DAVID M. SWARTLEY WILLIAM F NICHOLS* TER~tENCE R. WHITE** CHRIS7`QPHEEt S. NYE l00 EAST CARLT4N AVENUE, SUITE 3I P~~r OFFICE eox I I~0 MERIDIAN, IDAHO 836$0-1150 TEL ~Z08} 288-2489 FAX ~Z08} Z88•Z501 NAMPA OFFICE 104 NINTH AVENUE SOUTH Pa~T OFFICE sox z47 NAMPA, IDAHO 83653.0247 TEL 1208) 4d6.9Z71 FAX ~Z08) 4d6-4405 'ALSO ADMITTED IN OR ..ALSO ADMITTED IN WA Email via Intem~t: w#g~uwppm~.cam September 2 7, ~ X99 PLEASE REPLY TO MERIDIAN QFFICE ~ ~+~ ~~ ~. r. ~. - ,- Nlayorand Council :~ ~ ~ ~ ~ ~ ~ ~ ~_ ~ ~ ;~ . City of Meridian - ~'`~~:. ~ ~ ~ ~ ~.~ ~µ 33 E. Idaho Ave. ~~r' ~}~~ ~~~~~~.^;~~~ ~; ,'. ~~ Meridian ~D 83 d4Z Re: Chronology of Cherry Lane Recreation, Znc. Club douse Matters Dear Mayor and Council: I have been requested to prepare far the Mayor and City Council members a Chronology of events relative to the proposed development of a new clubhouse by ChezTy Lane Recreation, inc. This has been a somewhat confusin affair and X ha e this g P chronology will be helpful to each of you if you are questioned about this matter. Event No. I vas the determination that Cherry Lane Recreation, Znc. needed to file an application for conditional use permit for the construction of the new clubhouse. This was rewired due to the fact that they did not have an existing clubhouse on the golf course property and the project involved the construction of a new clubhouse. The subject property is zoned Low Density Residential ~R 4} which is defined at Section I I _Z-~o8 ~3} municipal code. A golf course is a non-conforming use in that zone. Therefore, the application did, in fact, constitute a conditional use as provided in §§ I ~ -Z-4D~ E Z and i I -Z-~D~ F of the municipal Cade. Cherry Lance Recreation, Inc. made the application and did not legally contest this procedure. Event No. Z The City Council adopted "Findings of Fact and Conclusions of La~v and Decision and Order Granting Conditional Use ~'ermit Subject to Conditions" on dune Z2n`~, 1~g9~, This included the condition ~vhich was agreed to and generous by one month Mayor and Council September 27, 1999 Page Z "1.20 The temporary clubhouse shall he used for a period not to exceed seven (7) months from the date of this order. Prior to moving of the temporary clubhouse, a letter of credit or cash shall be received by the City of Meridian as a guarantee for completion of the permanent clubhouse and parking lot in the amount of Five Hundred Thousand and No/100 ($500, 000.00) Dollars. " Event No. 3 These conditions were agreed to by Cherry Lane Construction, Inc., at the public hearing. A draft "irrevocable Letter of Credit" and other documents which included a draft Leasehold Deed of Trust were faxed to the City Attorney's office from Will Berg's office and Will phoned Sharon at our office about the Golf Course documents, with our inter-office note "Will says this not on the agenda, but it is holding up a substantial building permit." (Note: at this time My mother was critically ill) Y directed that Steve Rutherford review and approve the Letter of Credit form which he did on July 30~'. There was no letter of request or instruction or any direct contact from the bank with this office on this matter at this time that I am aware of. Event No. 4 Our office was ne~ct informed that Pioneer Title Company had requested as a condition of issuance of title insurance, [required by the Banlc in order to issue the Letter of Credit] that a Memorandum of Lease Agreement providing the legal description £or the second nine holes as being included in the lease. Negotiations on the language for this document were undertaken with me and Harold Houston of Pioneer Title Company, which memorandum was prepared by this office on August 11 `~, 1999. This was approved by the Council on August 17`x, 1999. Event No. 5 I received a letter dated August 13 from R. John Insinger, as attorney for Recreational Prs~perties, Inc., requesting the City execute an estoppel certificate. Mr. Insinger stated it was required by the lender and insurers for confirmation of the validity of the lease. He also requested more time for his client to construct the clubhouse. Gerry Mattison from the bank called regarding progress on the estoppel certificate. I notified the Mayor 4 ,. t Mayor and Council September ~7, ~ 999 Page 3 on August 18 of phis request at which time I recommended that the Mayor have all relevant department heads review the lease agreement, and the facts relative to the Cherry Lane Recreation, Inc. lease agreement. I expressed concerns about items 3, 4 and 7 of the estoppel agreement which would have constituted a written release of any claims under the lease agreement by the City as of the date it was issued. I notified John Insinger by phone of my concerns and advised that if his client needed more time to construct the clubhouse, they would have to file a new application to modify the conditional use permit and I encouraged him to fide the application i£ he felt they were going to need more time. Event No. 6 I received a letter from John Insinger on September 3 regarding the estoppel certificate, advising that they had modified Nos. 3, 4 and 7 of the certificate which I reviewed. I then prepared the "Lessor's Statement Concerning Agreement o£ Lease Dated October 30, 1978" for consideration by the Council which was passed on the September 7`~. The reasons for recommending to the City Council that it not authorize the e~cecution of the Lessor's Estoppel Certificate were: no legal obligation to do so; the proposed certificate could prevent the City from malting a legal claim it might have; it was`not clear at that point that the lease or lender had obtained approval from the City for the use of the lease as security for a loan. The Statement that was issued was designed to provide the assurances that the City could confirm at this- time. John Insinger was notified on September 7~'. Event No. 7 On September 10`", 1999 I was advised by phone by the City Clerk, Will Berg, that Gerry Mattison needed the Mayor's signature on the Statement that was authorized and on a Deed of Trust document. I was puzzled by the reference to the Deed of Trust and had the entire file pulled. It was only after looking though the file that T found attached on the back of the Letter of Credit document a draft Leasehold Deed of Trust. I prepared a letter to the Mayor enclosing the Draft "Leasehold Deed of Trust and Schedule C" which document was designed to secure the performance of a line of credit of $500,000.00 to Cherry Lane Construction. It was proposed that the City execute the Schedule C. Schedule C included onerous provisions that would have allo~~ved for future advances to be [' Mayor and Council September Z7,1999 Page 4 covered by the agreement. It provided that the City affirm that there ti~vere no defaults [same problem faced with the estoppel certificate], and the schedule would have also changed the terms of the lease agreement by extending the default time, and provided that the bank receive notice of default, and provided that the bank could object to any modification of the lease agreement, and provided that any lien the City might obtain would be subordinate to the bank's lien, all of which the City is not obligated legally to agree to. I recommended that the City Council consider this at its next meeting since it had not been authorized. I notified Gerry Mattison of this recommendation. He was quite upset advising that he had told me this was needed on three earlier occasions. I do not recall him ever stating such in any phone call prior to this date, and which cannot be confirmed by any communications with this office in writing from the bank. I demanded he send me everything the bank was requiring by faac. Event No. 8 I received a fa}c transmission from Gerry Mattison of the bank with an attached final draft of the Leasehold Deed of Trust on September 10~', 1999. Event No. 9 I prepared a memo to the Mayor and City Council on September 14`'`, 1999 attaching the fa~c from Gerry Mattison and the final copy of the "Leasehold Deed of Trust". Differences from the first draft included security for advances up to $1,800,000.00; all the other onerous provision were still there. This was submitted for the Council's consideration from this office. Event N'a. l 0 John Znsin er, Cherry Lane Rea'eation enc.'s attorney, on September 14~', g 1 ~ 9 ~ 9 f axed a letter to me with a copy of Cheery Lane Recreation, Znc.'s Notice of its exercise of the option to renew the term of the lease for a subsequent 3~-year term upon the expiration of the initial ~5-year term. Event Na. ~ ~ The matter of the request to execute Schedule C of the Leasehold Deed of Trust was placed on the agenda on September 2 ~ S~, ~n order to give the Council an alternative to consider, and after advice and consent far distribution from Charlie Rountree as President of the Council, who was Mayor and Council September Z7, 1999 Page 5 conducting the Council meeting that night, I prepared a "Consent to Lessee Assignment with Right or Reassignment by Deed of Trust" in order to assure that the City was meeting its obligation under section 14 of the Lease Agreement regarding assignment by the lessee to its lender. This was authorized. Event No. 12 I have been advised by the Banlc's attorney Mr. Ed Annsen that they will make an additional request that the City agree to give notice of default to the bank and that the bank be given notice of proposals to amend the lease agreement. I expect the bank will request this in an agreement form. This is not legally required of the City and it will be your decision in the management of this agreement whether or not to do so if requested. The biggest problem is that this will place an additional obligation on the City that is not provided for in the Agreement of Lease and will have to be staffed, so in the event either of these circumstances should arise the proper notice is given. All in all the City has in a very timely manner and in the prudent managment of the public trust responded to all requests made, and has met its obligations under the Agreement of Lease. zf ~rou need additional information on this matter please advise. Very truly yours, "Wm: F. Gigs , II ~~ ey~L:lWorklMlMeridian 153b~M1Chenry Lane Golf Course CUP~MayorCouncilSep27.ltr Office of the City Attorney The City of Meridian - Idaho's fnitial Point of Beginning R~cErv~l~ ~'o: Mayor and Counczl From: w~n~. F. G~gra}r, ~~Z, VVill~am F. Nichols Su.b~ect: Agreement of Lease Calf Course Date: September 2 S, ~ 999 X00 E. Carlton Ave. Suite 31 Pa Box ~ ~ 50 Meridian !D 83680-~ 150 Phone: 288-299 Fax: X88-501 E-mail: wtg~7a wppmg.com ~.~ ~ ~~~ ~~ ~F' ~'~~ ~~~L Our office has reviewed the Golf Course Agreement of Lease dated October 3, 1978, with Cherry Lane Recreation, Inc., the NuPacific Agreement dated October 3, 1978 and the Memorandum of Understanding dated December 23, 1977, all related to the Golf Course. We reviewed these agreements for the purpose of malting recommendations regarding any ongoing responsibilities that the City has under any of these agreements. w of Agreement of Lease,_ ~herrY Lane In reviewing the Agreement of Lease Cherry Lane we noted the following unusual items or provisions. Section 4 (b) requires that the golf course lessee make specific provisions for youth programs for "entertainment, instruction, and social" purposes. Section 8 requires the lessee to perform all of the city of Meridian's obligations contained in the city's agreement with NuPacific. Section 11 requires the lessee to indemnify the City from any damages, it mentions insurance, but does not contain any provisions requiring a specific amount of insurance. Section 16 gives the City the ability to review, but not to determine, the amount of greens fees charged to play the course. Section 15 contains very unusual options and lengthy provisions to renew the lease. Mavor &. Councx~ City of Meridian September Z8, I99~ Page Z The lessee has exercised its first option to renew the lease for an additional term of 30 years to extend the lease through the year 2033. Near the end of that e~ctended term, the City would need to negotiate with the current lessee, if the lessee expresses an intent to renew the lease for another ten years. This negotiation would be to determine what the terms and conditions of the second extension will be. The current language of the lease limits negotiation on the first renewal. The only limit that will be in place when it comes time to renegotiate the lease near the end of the first extended term, will be an obligation to negotiate in good faith. Therefore, at that time, terms such as the amount of rent to be paid, how the course is to be managed, and any other issues that will be important to the City at that time will be appropriate for negotiation into the new lease agreement. The City will not be bound to continue the lease on the same terms and conditions as the current lease. Re~riew of Agreement -~ NuPacific The agreement with NuPacific is an important part of the current lease arrangement because of the tie-in between the NuPacific agreement and the current lease with Cherry Lane. The City's obligations under this agreement are fairly extensive. For example, on pages 4 and 5, the City is obligated to maintain and manage the golf course in a manner typical to municipal public courses nationwide. It also requires at least an annual review of operations of the course with the possible requirement for hiring an outside consultant to advise the City with regard to these issues. Merely entering into a lease like the one with Cherry Lane Recreation, -Inc., does not excuse the City from performing according to the terms of the NuPacific agreement. This is a "nondelegable" provision. The City does not want to get into a position where it has to hire an outside consultant in order to satisfy the terms of the Nu Pacific agreement. We note that a few years ago, the City of Ontario, Oregon, spent a considerable amount of money hiring professional golf consultants to advise the City on the operation and maintenance of the Ontario municipal course. Page 6 of the NuPacific agreement contains a requirement that the City provide NuPacific with certified copies of insurance policies that cover the golf course. If these have not been provided in the past, it is possible that NuPacific may be willing to waive this requirement in writing. The term of the agreement with NuPacific has no definitive ending date, It Mayor & Council City of Meridian September 28, 1999 _ Page 3 specifies that the Agreement continues in effect as long as NuPacific or any transferee from NuPacific owns property in the Cherry Lane Village development. The Agreement can be terminated by mutual agreement of the parties, but otherwise it continues. It is also important to note that this particular agreement does not contain a standard "successors and assigns" clause which would make that particular agreement binding upon the successors and assigns of either party. Closely connected to the term of the agreement is the right on the part of NuPacific to re-purchase the golf course property from the City for its fair market value as deternuned by a bona fide offer from an unrelated third party or a certified appraisal. This ability to repurchase the golf course property continues through the term of the agreement and for an additional 15 years after the agreement is terminated. The default provisions under the Nu Pacific agreement are very strict. If the City failed to remedy a default after having been given 30 days written notice, specifying the default, then NuPacific could demand that the City deed the property back to NuPacific. Recomrnendativns We have several recommendations to make regarding the golf course lease and the NuPacific Agreement. 1. Lease Monitoring one department in the pity needs to be deli ated to monitor the lessee's performance under the lease. That monitorin should include an on oin review of g g g youth programs at the course, an annual review of eens fees, annual veri,ficatxon of gr insurance coverage, annual review of golf course mono ement which would include g the condition of the course, utilization, and financial matters, includin ca ital . g p improvement expenditures, repairs, and preventive maintenance. Also included would be marketing and promotions, and even erha s em lovment olicies. p p p P 2. Negotiate an end to the NuPacific A~Q,reement Tk~e City should also designate a department or person to make contact with ~~. i Mayor & Council City of Meridian September 28, 1999 Page 4 NuPacific to determine if an early end to the agreement can be negotiated. If NuPacific has sold all of its property within the development, then they typically would not have any interest in continuing with this agreement since it would serve no purpose for their company. Negotiating an end to the agreement would have the advantage of starting the 15 year repurcl-~ase time so that it would run out prior to the time that the extended lease will expire. More importantly an early temunation of the agreement would cut off the possibility of a claim for reversion of title to NuPacific on the basis of some sort of claimed default. Conclusion and goals and recommendations The advantage to monitoring the lease and seeking early termination of the NuPacific agreement are closely tied to the public purpose of having the golf course in the first place. The golf course lease provides very little funds to the City, but does provide citizens of the community with a public golf course which in turn likely brings additional commerce to businesses in the community and brings the City additional tax revenue from increased property values of those homes located near the course. It is a community asset and certain terms under the lease agreement give the City the ability to ensure that it continues to be a community asset. Assuming for purposes of this Memo, the renewal option has been exercised, and the lease will expire at the extended term in the year 2033, as stated before in this memo, the lease will be up for complete renegotiation including a reasonable rental payment. If for some reason or another, the current lessee chooses not to renew the lease in the year 2033 or if a new lease cannot be negotiated, then the City must be prepared to operate and manage the course or solicit other qualified lessees to operate the course_ Conducting a program of ongoing monitoring over the ne~ct 34 years -will best position the City to be prepared to: I . Negotiate with the current lessee; 2. Find a new lessee if unable to reach agreement with the current lessee; 3.. operate the course as a City run enterprise; and 4. insure that the course is kept xn top notch shape and does not deteriorate near the end of the e~~tended term. ey1Z:lWork1N11Meridian 153fiaM1Ctterr~ Lane Golf Course CUP1Course.Mem