HomeMy WebLinkAboutRESOLUTION 1990-67Suggested by: Administration
City of Kenai
B~8OLUTIONNO. 90-67
A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, AIASKATPJ~SFERRING
$5,300 IN THE AIRPORT LANDSYSTEM FUND FOR TAXES ON TRACTS B-i'AND
B-2, CIIAP #4.
WHEREAS, in April, 1990, the City of Kenai and Fred Meyer, Inc.
entered into a lease cancellation agreement on the above referenced
lots; and
WHEREAS, the cancellation agreement provides for the proration of
charges payable under the lease, which incladeproperty taxes.
NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI,
ALASKA, that the following budget transfers be made:
Airport Land system
From: Land - Contingency
To: Land - Miscellaneous
5,300
5,300
PASSED BY THE COUNCIL OFT HE CITY OF KENAI, ALASKA, this 7th day of
November, 1990.
·
Carol L. Freas, City Clerk
Approved by Finance:~~.~
(:!.0/26/90)
kl
1781-lBBI
CITY OF KENAI
210 I:IDAL(~ ~AI,.A~
T~HONE ~ - ~8
P~ ~7.2~14
TO:
Kenai City Council
FROM:
DATE:
Charles A. Brown, Finance Director
October 26, 1990
SUBJECT: Taxes, Tracts B-1 and B-2, CIIAP #4
Included in the November 7~ 1990 council packet are a resolution
transferring money and an item on the list of bills to be paid for
property taxes on the former Fred Meyer, Inc. lots.
Effective April 18, 1990, the City and Fred Meyer mutually agreed to
rescind the lease on Tracts B-1 and B-2. The cancellation agreement is
attached. The agreement says that "charges payable under the lease
shall be prorated." Property tax is a charge payable under the lease.
In April, neither the City nor Fred Meyer knew the ~mount of the
taxes. Tax bills are ma/led in July. On July 22nd, Fred Meyer paid
108/365 of the property texes, which is the appropriate ratio for the
days that they held the land under lease. The City owes the remainder
of the tax, calculated as fOllOws: ....
Taxon both lots
Fred Meyer pa~ment (108/365)
City share of property tax
that KPB has written off
Penalty and interest
Balance owed
$ 12,753.28
<3,773.57>
C3,763.
79.36
Normally, when a lease is cancelled in mid-year, the City requires the
lessee to pay the property taxes for that year. However, normally,
leases are cancelled at the request of the lessee; the City usually
does not have any particular desire to cancel.
Page Two
Kenai City Council
October 26, 1990
In' this case, the City did. desire to cancel the lease because it
believed that another lessee would develop'the property sooner.. This
is.~ evidenced by a sentence in the cancellation 'agreement' which says,
"LeSsor has .receiVed an offer to lease the property from a third party
and also desires to cancel .the lease." In fact, it might be said that
the City initiated, the cancellation. It is coneeon 'practice in the
real' estate business for the two parties t° prorate taxes for the year
in which land is transferred.
BecauSe of the circumstances of this cancellation, and because it is
standard practice when the parties both desire to transfer property, I
do not find .it unusual or inappropriate to. pay our share of the taxes.
This is just another cost of being in the land business. The texas
will be charged to the airport fund, which derived the revenue from
the lease. I urge the council to approve the resolution and to
approve pal~ent.
.Date~
parties:
And:
April ~ 1990
The City of Kenai
Fred Meyer, Inc.,
a home-ruled corporation
a Delaware corporation
RECITALS
", 0365
On or about July 8, 1985 Lessor and Fred Meyer Real
Estate Properties, Ltd. entered into a lease (the "Lease")
followingdescribed property in Kenai Reporting District, State of
Alaska:
Tracts B1 and B2, Cook Inlet Industrial Airpark
Subdivision, Kenai, Alaska (the "Property").
The Lease was recorded July 19, 1985, in Book 266 at. Page
625, Kenai Recording District.
on or
Properties, Ltd.
Lease to Lessee.
about October 17, 1986 Fred Meyer Real Estate
assigned its interest in the above referenced
Pursuant to the terms of the Lease' Lessee was to
onstruct a retail store on the property. Lessee has elected not~
o construct its retail store on. the Property and now desires to ~
ancel .the Lease.. Lessor. has received an offer to lease the ~
roperty from a third party and also desires to cancel the Lease.~
Now therefore, in consideration of the mutual promises
and covenants set forth in this agreem~t and other Yaluable
consideration, receipt.of which is.hereby acknowledged, the.parties
1. ~ncellat~n of ~se.
The Lease shall be cancelled effective th ~ day of
April, 1990 (the "Cancellation Date").
2. F/na.1 Prorations.
. The annual rent and other charges payable under the Lease~
all be prorated between the parties as oft he Cancellation Date./
ssee shall be responsible for paying rent and performing a11'
other obligations under the Lease arising prior tot he Cancellation
-1-
3. Sur_render of. Possess.~on.
oo,,0365 ' 413
Lessee will surrender possession of the Property_ to
LeSsor on,the Cancellation Date. '._~
...... In. witness-whereof the parties have executed this
instrument as.ofthe date first'above written.
LESSOR: CITY OF I~NAI
City Manager
LESSEE: FRED MEYER, INC.
/~ a Delaware corporation
Vice President
Corporate Facilities Division-
-2-
STATE OF ALASKA )
uoun=y or . ) .
.~On~this -/_~__~day of &~~__, 1990, before me, the
undersigned, a Nota~ ~l~c ~n aWd for the S~a~e of Alaska, duly
co~issioned ~d sworn, personally appeared W~11i~
me known ~o.' be.the Cit~ Mgnaqer of the C~tv of Kenai the home-
ruled co~oration ~at executed the foregoing ins~rument, and
acknowledged the said ~nst~ment to be the free and volunta~ ac~
and deed 0f said co~ora~on, for the uses and pu~oses therein
mentioned, and on oath stated that he is authorized to execute the
said inst~ent.
Witness my hand and official seal hereto affixed the day
STATE oF' OREGON
County of Multnomah
of Alaska, residing at
My Commission Expires:
On this ~ day-of ~, 1990, before ne, the
undersigned, a Notary Public in and for the State of Oreqon, duly
commissioned and sworn, personally appeared Alex_J. Lelli. Jr. to
me known to be the V/ce PreSident of Fred_Meyer. _Inc.. a Delaware
corporation the corp0ra%iOn that executed the foregoing instrument,--
and ackn0wledged..the said ~_nstrument to.be_ the free and.voluntary
act and deed of said corPoration, for the uses and purposes therein
mentioned, and on oath stated that he is authorized to execute the
said instnlment.
and year
WitneSs my hand and official seal hereto affixed the day
first above written·
of oFegon, residing a~:
My Commission Expires
90-3278
KENAI RFC
DISTH!CT
REO0 ;ST. O BY