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HomeMy WebLinkAbout99Dec07 CC Mtg MinsMeridian City Council Meeting December 7, 1999 Page 93 all part of a procurement policy which you'll deal with next year is possibly some basic protocols that the City, you might, adopt that would be protocols for the purchase of property so that when we enter these kinds of agreements or make offers, we just have some automatic boiler plate conditions that go in because this one was prepared by the realtor. It wasn't prepared by me. It's on a standard form offer purchase which was used by realtors and recognized by the State. The only panel that if we don't go through with it is the forfeiture of the $5,000 earnest money which this agreements provides. So it's not percentage concerning the volume of the purchase that huge a problem. So that's why it didn't get overly exercised about fussing with this too much. But I do think should give notice that we'd want to do some kind of environmental peek at this. I don't know what the history of that site is. Do you want me to keep going or do you want to deliberate on that one? Corrie: Unless somebody objects to it, I'd say go ahead. (inaudible) Rountree: As far as the Resolution goes? Gigray: I think the Clerk has the Resolution. Rountree: I would move that we adopt Resolution 276 for exclusive buyer and authorize the Mayor to sign and Clerk to attest. Bird: Second. Corrie: Motion made and seconded to approve the Resolution 276, Mayor to sign, Clerk to attest. Any further discussion? All those in favor of the motion say aye. MOTION CARRIED: THREE AYES, ONE ABSENT ITEM 18. DEPARTMENT REPORTS E. ATTORNEY -BILL GIGRAY 2. CHERRY LANE RECREATION Gigray: Mr. Mayor, members of the Council, the next Item I want to discuss has to do with the Cherry Lane Recreation issue, and as I believe, to bring you up to speed, you should have in your packets, a letter addressed to each of you from me dated December 3, 1999, and accompanying that should include the letter of response from Edward Ansen who represents Independent Bank who was in response to our letter of November 3'~ outlining the various four conditions that the City would request in order to enter into agreement to provide the bank with notice of default and notice -advance notice before any effective date of a modification of the agreement of lease with Cherry Lane Recreation, Inc. Bank Meridian City Council Meeting December 7, 1999 Page 94 wrote back in their letter basically saying, yes, we don't have a problem with your conditions except that we are not willing to guarantee that the funds derived from the loan would go to the construction of improvements upon the real property which is a subject of the conditional use permit. It is also my understanding from communications with the parties that the Cherry Lane Recreation did not have heartburn with any of the requests of the City, but I didn't get any further communications from them about proposed agreements to effectuate any of this, and I could see that we might be in a dead center position given the direction that was I thought I was given as a result of the workshop that we -Council workshop, I believe it was the last meeting. I determined to at least try to fashion an agreement which was an agreement between the bank, the City and Cherry Lane Recreation, Inc., that has some kind of unusual provisions because there's certain portions of the agreement that bind the Cherry Lane and the City and other portions that bind all three. The idea of that was primarily take care of the issue of the bank not being willing to guarantee the use of the funds, but yet through the agreement, provide a provision where the City can demand accounting of the use of those funds from Cherry Lane Recreation, Inc., that they would have to provide that verification and if we felt they were in default, they'd have 30 days to cure that, and if they didn't cure it, then they'd be in default with the agreement of lease, which I'll guarantee you would draw the attention (inaudible) the bank. Also, it provides that the initial disclosure of the information would be at the bank. The reason for that since this involves the use of financial funds for the construction of this property, it would probably become public records if it were here on site, we would provide in this agreement that that would have to be disclosed through the bank that we would access that information and then if we declared default, they`d have to -the bank would have to provide us with that information. So if we had to pursue it, we had it available to pursue it. It would -the agreement provides that Cherry Lane would agree that they would use the funds derived from the loan for the letter of credit as welt as for the construction of the improvements required as the condition of granting the conditional use permit, and then the other provisions in there that the City would provide the notice that the bank requires (inaudible) Section 4, proposed, and then whereas there's a provision in here in the event - to amend agreement of lease, to provide for insurance coverage: Now, I haven't included an amount in that, and this is in Section 6 of this proposed agreement, because that agreement of lease goes for so many years in the future for us to put in a specific amount now may seem fine and good, but it could become antiquated in the future. This is designed to provide the standard by which they're not going to carry less insurance and is going to be required to replace the improvements that are out there, and they can't provide insurance that would 6e less than what tort claims law provides, but also it has to equal what is characteristically provided by privately managed Ada and Canyon County, the courses of similar size, is to provide some kind of standard to agree as to the amount of insurance coverage because the existing agreement of lease doesn't provide that they provide insurance coverage, and now we have considerable and will have considerable improvements on there that weren't there before. Then there's certain provisions Meridian City Council Meeting December 7, 1999 Page 95 here with regards to allowing the City to have the option on a foreclosure sale to purchase the bank's interest in that so that you don't have the situation of that going on for sale without at least having the first shot at it. That, of course, would require the City to tender those funds just in advance of the sale date, and if it was cured prior to the sale date, then those funds would be returned to the City. There's about afive-day, I think, period there. Because I represent the City, I do not fee! that I had any authority to disclose a proposed agreement to the bank or to Cherry Lane Recreation, Inc., without first confiding in you to determine whether or not you would instruct me to share such an agreement with them and to pursue this or whether or not there're provisions in this that you don't like that you'd like changed or whether or not you'd like me to do anything. So I submit that for your consideration, not to enter into this agreement at this point, but whether or not to authorize me to transmit it to them, see whether or not they will agree to it or not. I would say that if we did transmit it, that would be a strong indication you would ultimately approve it, though. Corrie: Comments? Rountree: Mr. Mayor. Corrie: Mr. Rountree. Rountree: I would move that we authorize the City Attorney to transmit the draft agreement to the subject parties for their consideration and seek their approval to enter into such an agreement so we could move on with this particular project. Bird: Second. Corrie: Motion made and seconded to have the attorney send these (inaudible) to the Idaho Independent Bank and Cherry Lane Rec to see what their status would be on this. Any further discussion? All those in favor of the motion say aye. MOTION CARRIED: THREE AYES, ONE ABSENT ITEM 18. DEPARTMENT REPORTS E. ATTORNEY -BILL GIGRAY 3. PURCHASE AGREEMENT Gigray: I've been corrected by the City Clerk. We had two resolutions dealing with the police. One resolution dealing with the listing agreement with the reactor and another resolution dealing with the offer to purchase, and I don't know for purposes of the record, I would defer to the Clerk as to how he wants this clarified, because I think you only identified one resolution number.