Loading...
HomeMy WebLinkAbout11/18/2008, C3 - APPROVAL OF AGRICULTURAL LEASE WITH WILLIAM OSTRANDER ON CITY-OWNED PROPERTY AT 0 CALLE JOAQUIN (FO council j acEnaa Report c3 C ITY O F SAN L U IS O B I S P O FROM: Shelly Stanwyck,Assistant City Administrative Officer Prepared By: Neil Havlik,Natural Resources Manager SUBJECT: APPROVAL OF AGRICULTURAL LEASE WITH WILLIAM OSTRANDER ON CITY-OWNED PROPERTY AT 0 CALLE JOAQUIN (FORMER MCBRIDE/GEARHART PROPERTY) CAO RECOMMENDATION Approve an Agricultural Lease with William Ostrander to allow the lease of City owned property at 0 Calle Joaquin road fora five-year term and authorize the Mayor to execute the Agreement. DISCUSSION In November of 2006, the City acquired by gift approximately 13 acres of land from local developer Kelly Gearhart, as part of a project to develop four commercial lots on Calle Joaquin for auto sales purposes. The City lot included lands used for agriculture, plus a portion of the Prefumo Creek riparian corridor. Between eight and ten acres of the property are actually farmable, and in 2007 the City entered into a one-year agreement with a local agriculturalist, William Ostrander, to raise a hay crop on the property. As part of Mr. Ostrander's management, he was responsible for weed control on the property. This arrangement proved to be mutually beneficial: Mr. Ostrander raised a hay crop and the City obtained weed control and other site benefits at no cost. Mr. Ostrander has asked to be allowed to continue to lease the property for a longer tern. The longer term lease would allow Mr. Ostrander to install (at his own cost) a simple irrigation system that could provide water from an existing well on the property in the event of a poor rainfall year. The system would consist of a series of buried two inch diameter plastic water lines, to which a portable surface system could be connected. The five year term would allow Mr. Ostrander to amortize the cost of the system, and it would become the property of the City at the end of the lease or any extension thereof. Council members may recall that at one time there was interest by Cal Poly Professor Terry Vassey to establish a turf research facility at the site. That concept has evidently fallen victim to economic hard times and Dr. Vassey has informed staff that he has no prospects for such a facility at this time. Also, Mr. Ostrander has made satisfactory arrangements with the owners of the neighboring Gap property to raise a hay crop there, complementing the crop on City property. For these reasons staff feels that the proposed arrangement is in the best interests of the City. gAavlil✓councilagendo%strander lease Council Agenda Report—Approval of Agricultural Lease Page 2 FISCAL IMPACT The lease will have a small beneficial financial impact on the City. The rent is nominal ($1.00), but cost savings from the weed control effort would be in the range of$2,500 annually. In addition, the irrigation system that Mr. Ostrander would install would become City property at the end of the. lease term, and this system has an estimated value of $4,000 installed. Thus over the term of the lease the City would realize savings of approximately $12,500 plus the value of the irrigation system. ALTERNATIVES 1. The Council could reject the leasehold. This is not recommended since it would mean that the property would again be fallow, and the City would again have the maintenance obligation for an undetermined amount of time. 2. The Council could direct that staff prepare a Request for Proposals or similar mechanism to seek lessees. This is also not recommended as last year staff did make a number of inquiries of local agriculturalists seeking interest in farming the area. These were unsuccessful until we contacted Mr. Ostrander through the recommendation of our goat contractor Beth Reynolds. The relationship has proven beneficial, and staff feels that this is the most cost-effective approach to managing the site and keeping it in productive agriculture. ATTACHMENT Proposed Agricultural Lease ATTACHMENT 1 AGREEMENT BETWEEN THE CITY OF SAN LUIS OBISPO AND WILLIAM OSTRANDER FOR USE OF CITY PROPERTY AT 0 CALLE JOAQUIN This Agreement is entered into this sT day of'2008,between the City of San Luis Obispo(hereinafter referred to as "the City")and William Ostrander, (hereinafter referred to as "Tenant"), for lease of unimproved City owned property at 0 Calle Joaquin(San Luis Obispo County Assessor's Parcel No. 053-152-005)(hereinafter referred to as"the Property.") WITNESSETH WHEREAS,the City is the legal owner of the property located at 0 Calle Joaquin in the City of San Luis Obispo; and WHEREAS,the City desires to retain the property in agricultural use, and WHEREAS,Tenant has engaged in farming of the Property and wishes to improve irrigation capability thereon at his sole expense, and WHEREAS, Tenant needs a longer lease term to justify such improvements, and WHEREAS,the City believes that such continued agricultural use and installation of physical improvements are in the public benefit; NOW,THEREFORE, in consideration of the mutual covenants, conditions, promises, and agreements herein set forth,the City and Tenant hereby agree to the following terms and conditions for use of the Premises: 1. Use of the Premises. The City hereby leases the Property to Tenant for the purpose of agricultural production. 2. Purpose of Agreement. Tenant agrees that the lease of the Property shall be for the sole purpose of Tenant's use(s)related to such agricultural production. Any costs associated with the use and maintenance of the Property by the Tenant for Tenant's purposes shall be at Tenant's sole expense. 3. Term of Agreement. The term of this agreement shall commence upon execution by both parties and shall extend for a period of Five Years. 4. Extent and Condition of the Premises. Tenant accepts the Property "as is." City makes no warranty as to the suitability of the Property for such use. 5. Rent. Rent of the Property for the full term shall be One Dollar($1),payable on the first day of this agreement. 6. Cost of Operations. The Contractor shall bear the entire cost of its operations on 1 C� ATTACHMENT f the Property, including utility bills and any taxes and fees related to its occupancy of the Property, such as possessory interest taxes. 7. Maintenance. Tenant shall maintain the Premises at all times in a reasonable manner and condition suitable to and as directed by the Natural Resources Manager. This specifically includes a reasonable level of control of weeds and fire hazard. 8. Improvements to the Premises. The City shall be notified before any improvements are made to the Property. Any improvements made by Tenant shall be provided at the sole expense of the Tenant. Any improvements installed by Tenant and affixed to the land (including but not limited to fences,pipelines, gates, etc.)shall either be removed by Tenant at , the conclusion of the Lease or ant extension thereof,or shall become the property of the City upon conclusion of the Lease or any extension thereof. The City shall have the sole discretion to make the determination of which.course of action above shall apply. Tenant agrees that the Property is provided"as is"and the City has no obligation to provide improvements to the Property for Tenant's use. 9. Termination of this Agreement by the City. The City reserves the right to terminate this agreement by notifying the Contractor in writing sixty days prior to termination, should the City need the property for official City business. In doing so, however,the right of the Tenant to harvest his crop shall be respected. 10. Termination of this Agreement by Tenant. Tenant may terminate this agreement by notifying the City in writing sixty days prior to termination. 11. Non-discrimination. There shall be no discrimination against or segregation of any person or group of persons on account of race, religion, sex, sexual orientation,national origin, age, physical,mental or economic status in the construction, operation, lease, sublease, use, occupancy,tenure or enjoyment of the Property or the improvements thereon, or any part thereof, and Tenant, or any person claiming under or through it, shall not establish or permit any such practice of discrimination or segregation with reference to the use of the Property,or the selection, location, number, use or occupancy of employees, contractors, subcontractors, laborers or material men,tenants, lessees, subtenants, sub lessees, invitees or vendees of the Property or the improvements thereon, or any part thereof. 12. Relationship of Parties. Under this agreement,the City shall be solely and exclusively a lessor, and Tenant shall be solely and exclusively a lessee. Tenant shall not be considered a partner, agent, officer, or employee of the City. Tenant's officers, members, affiliates, volunteers, employees and independent contractors shall not be considered agents, officers or employees of the City. 13. Assignment. Tenant shall not assign this agreement to another party without the City's prior written consent. 14. Insurance. Tenant shall provide proof of general liability insurance of not less than$1,000,000 per occurrence and not less than$2,000,000 in aggregate. 2 ATTACHMENT 1 15. Indemnification. Tenant shall indemnify and save harmless the City, its officers, agents, and employees against: A. Any and all claims and demands which may be made against the City, its officers,agents or employees by reason of any injury or death of any person or corporation caused by any act or omission of Tenant under this agreement or of Tenant's employees or agents; B. Any and all damage to or destruction of the property of the City,its officers, agents, or employees, occupied or used by or in the care, custody, or control of Tenant, caused by any act or omission of Tenant under this agreement; C. Any and all claims and demands which may be made against the City, its officers, agents,or employees by reason of any injury to or death of or damage suffered or sustained by an employee or agent of the Tenant under this agreement, however caused, excepting, any such claims or demands which are the result of the sole active negligence or willful misconduct of the City, its officers,agents, or employees; D. Any and all penalties imposed or damages sought on account of the violation of any law or regulation or of any term or condition of any permit, when said violation of any law or regulation or of any term or condition of any permit is due to negligence on the part of Tenant. E. Tenant, at its own costs, expense, and risk shall defend any and all suits, actions, or other legal proceedings that may be brought against or for employees on any such claim or demand of such third persons, or to enforce any such penalty,and pay and satisfy any judgment or decree that may be rendered against the City, its officers, agents,or employees in any such suit, action,or other legal proceeding, when same were due to negligence of Tenant. 16. Enforcement Costs and Attorney's Fees. The prevailing party in any action between the parties to this agreement, brought to enforce the terms of this agreement, may recover from the other party reasonable costs and attorney's fees in connection with such an action. 17. Notice. All notice provided relative to the terms and conditions of this agreement shall be in writing as follows: Tenant: William Ostrander 1350 Partner Road San Luis Obispo, CA. 93405 City: City of San Luis Obispo Neil Havlik, Natural Resources Manager 990 Palm Street San Luis Obispo, CA 93401 3 ATTACHMENT 1 18. Entirety and Integrity of this Agreement. This document represents the entire and integrated agreement between the City and Tenant. This document supersedes and negates all prior negotiations, representations, agreements and amendments, either written or oral, regarding the Property and the use of the Property by Tenant. Both parties also recognize that some issues may not have been anticipated or addressed herein,and that changes to the agreement may be wan-anted. This agreement may be amended upon written consent of both parties,to the approval of the City Administrative Officer and the City Attorney and as provided by law. This Agreement is executed this day of 2008, in the City of San Luis Obispo, State of California. Tenant: t _0 1 liam Ostrandy City: Attest: Approved as to form: Audrey Hooper, City Clerk Jonathan.Lowell, City Attorney Mayor Dave Romero 4 L4 �l�fi �r1VIRONMENT NOV h 6 200E RED FILE ' MEETING AGEN SLO CITY CLERK s ; , DATE// TE'.11 ! � FpUBLIC EPI-Ccnter.1013 Monterey Street,Suite 20ZSan Luis Obispo,CA 93401 Phone:805-781-9932 • Fax:805-781-9384 San Luis o is o COASTK�EEPERO COUN IL 'CDD Dave Romero,Mayor dcAC 2TIN DIR San Luis Obispo City Council CTACAO Z'FIRE CHIEF 990 Palm Street EE 1TG� ORNEY PW DIR F1 San Luis Obispo, CA 93401 CLERK/ORIG Z'POLICE CHF November 18, 2008 ❑ DEPT HEADS Z'REC DIR F;r- i3 ZUTIL DIR VIA EMAIL and FAX TWiL UA4 2`HR DIR cr Subject: Agenda Item C3 —Approval of Agricultural Leas`e2Ani:!iy Owned Property Dear Mayor Romero and Honorable Council, Tonight your Council will consider, on consent, approval of a 5-year agricultural lease with William Ostrander to allow the use of City owned property at 0 Calle Joaquin Road for farming hay. Staff is recommending this proposal as a means of mitigating the cost to the City of controlling weeds. However, considering the serious State and National economic crisis and the financial impact on San Luis Obispo citizens,the undersigned organizations urge on behalf of our members and supporters that you table this item for consideration of additional alternatives. In 2006 the 13 acre property under consideration was gifted to the City as a public benefit. The undersigned organizations believe the benefit of use as a community garden has been overlooked. Therefore, we specifically request that you direct Staff to return for your consideration of an alternative use of this property as a community garden. Community gardens confer many public benefits more compatible with City goals and of higher value to the citizens of SLO than the proposed hay lease Sincerely, e v-�a ( u b Gordon R. Hensley, P SLb Coastkee er C WAMKIMPER'A KNCF MEMBER VJaI:iG u�::C �:Z RIII:.R;d. Il: zmd :S:::cTsdJ for lL�d tic,dl11 1