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HomeMy WebLinkAboutResolution No. 2011-69a,cryo/ KENAI, ALASKA Suggested by: Administration CITY OF KENAI RESOLUTION NO. 2011 -69 A RESOLUTION OF THE COUNCIL OF THE CITY OF KENAI, ALASKA, AUTHORIZING THE PURCHASE OF APPROXIMATELY 60 ACRES OF PROPERTY DESCRIBED AS THE NE1 /4 NE 1/4 AND THE E 1/2 SE 1/4 NE 1/4 OF' SECTION 36, TOWNSHIP 6 NORTH, RANGE 11 WEST, SEWARD MERIDIAN, ALASKA CONTAINING 60 ACRES MORE OR LESS FOR PUBLIC WATER WELLS, WELL HEAD PROTECTION, AND ASSOCIATED PUBLIC PURPOSES AND DETERMINING THAT THE PUBLIC INTEREST WILL NOT BE SERVED BY AN APPRAISAL. WHEREAS, the City of Kenai identified property described as NE 1/4 NE 1/4 AND THE E 1/2 SE 1/4 NE 1/4 OF SECTION 36, Township 6 North, Range 11 West, Seward Meridian, Alaska Containing 60 acres more or less, Kenai, Third Judicial District (the Property) in the vicinity of the municipal water utility production wells as a potential site for a well protection area; and, WHEREAS, the City Manager submitted an Application to the Kenai Peninsula Borough (the Borough) on behalf of the City to process a negotiated sale of the property for $1.00; and, WHEREAS, the Borough enacted Kenai Peninsula Borough Ordinance 2011 -21, which accompanies this resolution, authorizing a negotiated sale at less than fair market value in the amount of $2.00; and, WHEREAS, KMC 22.05.135(a) states the following: The City, by authorization of the city council, expressed in a resolution for such purpose, may lease, purchase or acquire an interest in real property needed for a public use on such terms and conditions as the council shall determine No purchase shall be made until a qualified appraiser has appraised the property and given the council an independent opinion as to the full and true value thereof, unless the council, upon resolution so finding, determines that the public interest will not be served by an appraisal; and, WHEREAS, the Borough Assessing Department performed an appraisal of the property and considering the wetlands, estimated the value at $24,700; and, NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, the Council Authorizes the Purchase of Property Described as NE 1/4 NE 1/4 AND THE E 1/2 SE 1/4 NE 1/4 OF SECTION 36, Township 6 North, Range 11 West, Seward Meridian, Alaska Containing 60 acres more or less, Kenai, Third Judicial District, for $2.00, for Public Water Wells, Well Head Protection, and Associated Public Purposes and, pursuant to KMC 22.05.135(a), Determines That The Public Interest will not be served by an Appraisal. Resolution No. 2011 -69 Page 2 of 2 PASSED BY THE COUNCIL OF THE CITY OF KENAI, ALASKA, this 21st day of September, 2011. ATTEST: Corene Hall, Deputy City Clerk PAT PORTER, MAYOR PURCHASE AGREEMENT This Agreement is made on this of , 2011, by and between the KENAI PENINSULA BOROUGH, an Alaska municipal corporation, whose address is 144 North Binkley Street, Soldotna, Alaska 99669 (hereinafter referred to as "KPB ") and the City of Kenai, an Alaska municipal corporation, whose address is 210 Fidalgo Avenue, Kenai, Alaska 99611 (hereinafter referred to as "BUYER"). WHEREAS, KPB is the owner of that real property located in the Kenai Recording District, Third Judicial District, State of Alaska, and more particularly described as follows: THE NE1 /4 NE1 /4 AND THE E1/2 SE1 /4 NE1 /4 OF SECTION 36, TOWNSHIP 6 NORTH, RANGE 11 WEST, S.M. ALASKA CONTAINING 60 ACRES MORE OR LESS, subject to survey platting requirements WHEREAS, Buyer has offered to buy, and KPB is willing to sell the above - described Property as evidenced by KPB Ordinance 2011 -21 enacted July 5, 2011, by the Assembly of the Kenai Peninsula Borough. NOW THEREFORE, in consideration of the promises herein contained, KPB hereby agrees to sell to BUYER, and BUYER hereby agrees to buy from KPB, the property on the terms and conditions as set forth below: 1. PURCHASE PRICE The purchase price of the property is $2.00 dollars and NO cents and shall be paid in full at dosing. 2. TITLE Title shall be delivered at time of closing by quitclaim deed which shall be issued to BUYER. Seller sells only its interest in the property, if any, without warranty of any kind or nature whatsoever. Title shall also be subject to reservations, easements, rights -of -way, covenants, conditions and restrictions of record. BUYER warrants and covenants that at the time of closing there shall be no liens or judgments recorded against BUYER in the same recording district in which the property subject to this purchase agreement is situated. 3. ESCROW AND CLOSING COSTS In addition to the purchase price, BUYER agrees to pay for all closing costs in connection with this Agreement, including without limitation all escrow fees, title Kenai Peninsula Borough, Alaska Page of 9 Purchase Agreement — KPB /City of Kenai insurance charges, recording fees and bank charges. All costs must be paid in full at the time of closing. 4. CLOSING Closing will occur within 90 days of recording a subdivision plat of the subject property. Both parties will execute all documents required to complete the Purchase Agreement. 5. POSSESSION Possession shall be delivered to BUYER at time of recording. 6. DEED RESTRICTION The property conveyed to the City of Kenai is further subject to the restriction that the land conveyed shall be used for public water wells, well head protection, and associated public purposes. In the event grantee does not use, or ceases to use, the land conveyed as herein specified, grantor or grantor's assigns may re- enter and repossess the premises. Grantee may elect to remove this restriction by payment of fair market value as determined by current tax assessment. 7. BREACH BY BUYER; REMEDIES OF KPB Prior to closing of the sale, in the event that BUYER fails to make any payment required, or fails to submit or execute any and all documents and papers necessary in examination of BUYER's financial background, or with closing and transfer of title within time periods specified in this Agreement, up to lesser of $1,000.00 or 10% of the purchase price of BUYER's deposit shall be retained by KPB as liquidated damages. Additionally, other funds may be retained for out - of- pocket expenses incurred, and this Agreement shall be terminated. In addition to the foregoing, in the event of a default in the performance or observance of any of the agreement terms, conditions, covenants and stipulations thereto, either prior to or after the closing of the sale, and such default continues thirty days after written notice of the default, KPB may cancel the agreement or take any legal action for damages or recovery of the property. No improvements may be removed during the time which the contract is in default. This provision shall survive the execution of sale documents and shall continue in full force and effect until either the purchase price is paid in full or the sale is otherwise terminated. 8. NOTICE OF DEFAULT. Notice of default will be in writing as provided hereinbelow. A copy of the notice will be forwarded to all lienholders or others who have properly recorded their interest in the purchase agreement with KPB. Kenai Peninsula Borough, Alaska Page 2 of 9 Purchase Agreement-- KPB /City of Kenai REMOVAL OR REVERSION OF IMPROVEMENTS UPON CANCELLATION OF PURCHASE AGREEMENT OR LEASE. A. BUYER covenants that improvements owned by the BUYER on KPB lands shall, within thirty calendar days after termination of the agreement, be removed by BUYER; provided, such removal will not cause injury or damage to the land; and further provided, that the mayor or planning director when applicable may extend time for removing such improvements in cases where hardship is proven. The retiring BUYER may, with consent of the mayor or planning director when applicable, dispose of BUYER'S improvements to the succeeding BUYER. B. If any improvements and /or chattels having an appraised value in excess of ten thousand dollars, as determined by a qualified appraiser, are not removed within the time allowed, such improvements and /or chattels shall, upon due notice to the BUYER, under the terminated or canceled contract, be sold at public sale under the direction of the mayor and in accordance with provisions of KPB Title 5. Proceeds of the sale shall inure to the former BUYER, lessee, or permittee who placed such improvements and /or chattels on the lands, or his successors in interest, after paying to KPB all monies due and owing and expenses incurred in making such a sale. In case there are no other bidders at any such sale, the mayor is authorized to bid, in the name of KPB, on such improvements and /or chattels. Bid money shall be taken from the fund to which said lands belong, and the fund shall receive all moneys or other value subsequently derived from the sale or leasing of such improvements and /or chattels. KPB shall acquire all rights, both legal and equitable, that any other BUYER could acquire by reason of the purchase. C. If any improvements and /or chattels having an appraised value of ten thousand dollars or less, as determined by the mayor, are not removed within the time allowed, such improvements and /or chattels shall revert and absolute title shall vest in KPB. Upon request, BUYER, lessee, or permittee shall convey said improvements and /or chattels by appropriate instrument to KPB. D. Rental for Improvements or Chattels not Removed. Any improvements and /or chattels belonging to the BUYER and placed on the land during BUYER'S tenure with or without BUYER'S permission and remaining upon the premises after termination of the contract shall entitle KPB to charge a reasonable rent therefor. 10. RESALE. Kenai Peninsula Borough, Alaska Page 3 of 9 Purchase Agreernent— KPB /City of Kenai In the event that a purchase agreement should be terminated, canceled, forfeited or abandoned, KPB may offer said lands for sale, lease or other appropriate disposal pursuant to provisions of KPB 17.10 or other applicable regulations. If said land is not immediately disposed of then said and shall return to the Land Bank. 11. DEFENSE AND INDEMNIFICATION The BUYER shall indemnify, defend, save and hold the borough, its elected and appointed officers, agents and employees, harmless from any and all claims, demands, suits, or liability of any nature, kind or character including costs, expenses, and attorneys fees resulting from BUYER'S performance or failure to perform in accord with the terms of this Agreement in any way whatsoever. The BUYER shall be responsible under this clause for any and all claims of any character resulting from BUYER or BUYER'S officers, agents, employees, partners, attorneys, suppliers, and subcontractors performance or failure to perform this Agreement in any way whatsoever. This defense and indemnification responsibility includes claims alleging acts or omissions by the borough or its agents, which are said to have contributed to the losses, failure, violations, or damage. However, BUYER shall not be responsible for any damages or claims arising from the sole negligence or willful misconduct of the borough, its agents, or employees. 12. HAZARDOUS MATERIAL A. BUYER covenants and agrees that no hazardous substances or wastes shall be located on or stored on the property, or any adjacent property, nor shall any such substance be owned, stored, used, or disposed of on the property or any adjacent property by BUYER, its agents, employees, contractors, or invitees, prior to BUYER'S ownership, possession, or control of the property. B. BUYER covenants and agrees that if the presence of hazardous material on the property is caused or permitted by BUYER, its agents, employees, contractors, or invitees, or if contamination of the property by hazardous material otherwise occurs on the property, BUYER shall defend, indemnify, and hold harmless KPB from any and all claims, judgements, damages, penalties, fines, costs, liabilities, or losses (including, but not limited to, sums paid in the settlement of claims, attorney's fees, consultant fees and expert fees) which may arise as a result of such contamination. This defense and indemnification includes, without limitation, costs incurred in connection with any investigation of site conditions or any clean -up, remedial, removal, or restoration work required by any federal, state or local government on or under the property. As used herein, the term "hazardous material" means a Kenai Peninsula Borough, Alaska Page 4 of 9 Purchase Agreement — KPB /City of Kenai substance or material that the Secretary of Transportation has determined is capable of posing an unreasonable risk to health, safety, and property when transported in commerce, and has designated as hazardous under section 5103 of Federal hazardous materials transportation law (49 U.S.C. 5103). The term includes hazardous substances, hazardous wastes, marine pollutants, elevated temperature materials, materials designated as hazardous in the Hazardous Materials Table (see 49 CFR 172.101), and materials that meet the defining criteria for hazard classes and divisions in part 173 of subchapter C of this chapter. 13. ASSIGNMENTS BUYER may assign the lands upon which BUYER has an agreement only if approved by the mayor or planning director when applicable. Applications for assignment shall be made in writing on a form provided by the land management division. Assignment shall be approved if it is found that all interests of KPB are fully protected. Assignee shall be subject to and governed by provisions of KPB 17.10 applicable thereto. 14. ENTIRE AGREEMENT This Agreement and the documents referred to herein contain the entire agreement of the parties with respect to the subject matter hereof. Any changes, additions or deletions hereto must be made in writing and signed by both KPB and BUYER or their respective successors in interest. Provisions of this agreement, unless inapplicable on their face, shall be covenants constituting terms and conditions of the sale and of the agreement to finance the sale, and shall continue in full force and effect until the purchase price is paid in full, or this agreement is earlier terminated. 15. MISCELLANEOUS A. Covenants. BUYER agrees to comply with any Declaration of Covenants, Conditions, and Restrictions of record, affecting the Property. B. No Warranty. BUYER acknowledges its responsibility to inspect the property and agrees KPB assumes no liability for matters that would have been disclosed to the BUYER by an inspection of the property. BUYER further acknowledges that KPB makes no warranties, either expressed or implied, nor assumes any liability whatsoever, regarding the social, economic or environmental aspects of the property, to include without limitation, soil conditions, water drainage, physical access, availability of personal use wood supplies now or in the future, or natural or artificial hazards which may or may not exist or merchantability, suitability, or Kenai Peninsula Borough, Alaska Page 5 of 9 Purchase Agreement— ICPB /City of Kenai profitability of the property for any use or purpose. The parties mutually agree that this transfer will not be covered by the Residential Real Property Transfers Act, AS 34.70.010 et. seq. C. Development. BUYER agrees the construction and maintenance of any improvements, roads, drainage systems and common areas shall be the responsibility of the BUYER. BUYER further agrees to comply with all federal, state, and borough regulations regarding use and development of the property, which includes but is not limited to; State of Alaska, Department of Environmental Conservation regulations regarding water and sewer installation; and if applicable, regulations of the U.S. Army Corps of Engineers regarding filling or draining any area within the property designated as wetlands by the appropriate authority. D. Time. Time is of the essence in performance of this Agreement. E. Cancellation. This agreement, while in good standing may be canceled in whole or in part, at any time, upon mutual written agreement by BUYER and the mayor or planning director when applicable. This purchase agreement is subject to cancellation in whole or in part if improperly issued through error in procedure or with respect to material facts. F. Entry or Re -entry. In the event that this agreement is terminated, canceled or forfeited, or in the event that the demised lands, or any part thereof, should be abandoned by the BUYER during the agreement term, or prior to payment in full of the purchase price, KPB or its agents, servants or representative, may immediately or any time thereafter, enter or re -enter and resume possession of said lands or such part thereof, and remove all persons and property therefrom either by summary proceedings or by a suitable action or proceeding at law or equity without being liable for any damages therefor. Entry or re -entry by KPB shall not be deemed an acceptance or surrender of the contract. G. Fire Protection. The BUYER shall take all reasonable precautions to prevent, and take all reasonable actions to suppress destructive and uncontrolled grass, brush, and forest fires on the and under agreement, and comply with all laws, regulations and rules promulgated and enforced by the protection agency responsible for forest protection within the area wherein the demised premises are located. H. Notice. Any notice or demand, which under the terms of this agreement or under any statute must be given or made by the parties thereto, shall be in writing, and be given or made by registered or certified mail, addressed to the other party at the address shown on the contract. However, either party may designate in writing such other address to Kenai Peninsula Borough, Alaska Page 6 of 9 Purchase Agreement - -- KPB /City of Kenai which such notice of demand shall thereafter be so given, made or mailed. A notice given hereunder shall be deemed received when deposited in an U.S. general or branch post office by the addressor. Responsibility of Location. It shall be the responsibility of the BUYER to properly located himself and his improvements on the purchased, leased, or permitted lands. J. Rights of Mortgage or Lienholder. In the event of cancellation or forfeiture of a sale agreement for cause, the holder of a properly recorded mortgage, conditional assignment, or collateral assignment will have the option to acquire the sale agreement for the unexpired term thereof, subject to the same terms and conditions as in the original instrument. Any party acquiring an agricultural purchase or lease agreement must meet the same requirements as the original BUYER or lessee. K. Rights -of -way. All trails or roads in existence at the time the land is sold may be considered to be an easement for public use. Nothing herein contained shall prevent the mayor or planning director when applicable from specifically reserving such additional easements and rights -of -way across KPB lands as deemed reasonable and necessary prior to the sale thereof. L. Sanitation. The BUYER, lessee, or permittee shall comply with all regulations or ordinances which a proper public authority in its discretion shall promulgate for promotion of sanitation. Premises under purchase or lease agreement, or permit shall be kept in a clean and sanitary condition and every effort shall be made to prevent any pollution of waters and lands. M. Shore Land Public Access Easement. As established by AS 38.05, KPB lands sold or leased may be subject to a minimum 50 foot public access easement landward from the ordinary high water mark or mean high water mark. N. Violation. Violation of any provision of KPB Chapter 17.10, or of the terms of the agreement of sale may expose BUYER to appropriate legal action including forfeiture of purchase interest, termination, or cancellation of BUYER'S interest in accordance with state law. 0. Written Waiver. Receipt of payment by KPB, regardless of knowledge of any breach of the purchase agreement by BUYER, or of any default on the part of BUYER, in observance or performance of any of the conditions or covenants of the agreement, shall not be deemed to be a waiver of any provision of the agreement. Failure of KPB to enforce any covenant or Kenai Peninsula Borough, Alaska Page 7 of 9 Purchase Agreement--- KPB /City of Kenai provision therein contained shall not discharge or invalidate such covenants or provision or affect the right of KPB to enforce the same in the event of any subsequent breach or default. Receipt by KPB of any payment of any other sum of money after notice of termination or after the termination of the agreement for any reason, shall not reinstate, continue or extend the agreement, nor shall it destroy or in any manner impair the efficacy of any such notice of termination unless the sole reason for the notice was nonpayment of money due and payment fully satisfies the breach. P. Construction. This Agreement shall be deemed to have been jointly drafted by both parties. It shall be constructed according to the fair intent of the language as a whole, not for or against any party. The interpretation and enforcement of this Agreement shall be governed by the laws of the State of Alaska. The titles of sections in this Agreement are not to be construed as limitations of definitions but are for identification purposes only. This Agreement has been executed by the parties on the day and year first above written. KENAI PENINSULA BOROUGH: CITY OF KENAI David R. Carey, Mayor Rick Koch, City Manager Dated: Dated: ATTEST: APPROVED AS TO LEGAL FORM AND SUFFICIENCY BY: Johni Blankenship, Holly B. Montague, Borough Clerk Deputy Borough Attorney Kenai Peninsula Borough, Alaska Page 8 of 9 Purchase Agreement— KPB /City of Kenai NOTARY ACKNOWLEDGMENT STATE OF ALASKA )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2011, by David R. Carey, Mayor of the Kenai Peninsula Borough, an Alaska municipal corporation, for and on behalf of the corporation. Notary Public in and for Alaska My commission expires: NOTARY ACKNOWLEDGMENT STATE OF ALASKA )ss. THIRD JUDICIAL DISTRICT ) The foregoing instrument was acknowledged before me this day of 2011, by Rick Koch, City Manager of the City of Kenai, an Alaska municipal corporation, for an on behalf of the corporation. Notary Public in and for Alaska My commission expires: Kenai Peninsula Borough, Alaska Page 9 of 9 Purchase Agreement KPB /City of Kenai Introduced by: Mayor Date: 06/07/11 Hearing: 07/05/11 Action: Enacted as Amended Vote; 9 Yes, 0 No, OAbsent KENAI PENINSULA BOROUGH ORDINANCE 2011 -21 AN ORDINANCE AUTHORIZING A NEGOTIATED SALE AT LESS THAN FAIR MARKET VALUE OF LANDS DESCRIBED AS THE NE1 /4 NE1 /4 AND THE E1 /2 SE1 /4 NEI /4 OF SECTION 36, TOWNSHIP 6 NORTH, RANGE 11 WEST, SEWARD MERIDIAN ALASKA CONTAINING 60 ACRES MORE OR LESS TO THE CITY OF KENAI WHEREAS, the Kenai Peninsula Borough has state patent to certain lands within the city of Kenai; and WHEREAS, the City Manager for the City of Kenai has submitted an application on behalf of the city to process a negotiated sale of 60 acres; and WHEREAS, the City of Kenai has public water wells adjacent to this property; and WHEREAS, the land proposed for conveyance lies east of the Twin City Raceway, which is subject to a borough- issued land use permit, and is designated wetlands which limits the usefulness of said lands; and WHEREAS, the proposed negotiated sale will allow the city to create a wellhead protection zone and establish additional wells; and WHEREAS, the property is zoned "Rural Residential" and was classified "Recreational" per KPB Resolution 96 -057; and WHEREAS, on May 11, 2011, the KPB Assessing Department determined the fair market value of the 60 acre parcel to be $24,700; and WHEREAS, the KPB Planning Commission at its regularly scheduled meeting of June 27, 2011, recommended enactment of this ordinance by unanimous consent. NOW, THEREFORE, BE IT ORDAINED BY THE ASSEMBLY OF THE KENAI PENINSULA BOROUGH: SECTION 1. That the Assembly finds that selling the NE1 /4 NE1 /4 and the E1 /2 SE1 /4 NE1 /4 of Section 36, T6N, RI 1 W, S.M. Alaska containing 60 acres more or Less to the City of Kenai, pursuant to KPB 17.10.100(I) and 17.10.120(D) is in the best interest of the Kenai Peninsula Borough, Alaska New Text Underlined; [DELETED TEXT BRACKETED] Ordinance 2011 -21 Page 1 of 2 SECTION 2. SECTION 3. borough as it will provide wellhead protection for the City of Kenai's public water utility for the benefit of borough residents within the city of Kenai. That conveyance of the parcel is contingent on subdivision and that the City of Kenai is responsible for the surveying and platting costs. Based on the foregoing, the mayor is hereby authorized, pursuant to KPB 17.10.100 (1) to sell the land described in Section 1 above to the City of Kenai for $2.00. The terms of the sale is cash at closing and the buyer shall pay all closing costs. SECTION 4. The mayor is authorized to execute the purchase agreement substantially in the form of the one accompanying this ordinance and sign any documents necessary to effectuate this ordinance. SECTION 5. That the property conveyed to the City of Kenai is further subject to the restriction that the land conveyed shall be used for public water wells, well head protection, and associated public purposes. In the event grantee does not use, or ceases to use, the land conveyed as herein specified, grantor or grantor's assigns may re -enter and repossess the premises. Grantee may elect to remove this restriction by payment of fair market value as determined by current tax assessment. SECTION 6. The City of Kenai shall have 180 days after enactment of this ordinance to execute a purchase agreement. SECTION 7. That this ordinance shall take effect immediately upon its enactment. ENACTED BY THE ASSEMBLY OF THE KENAI PENINSULA BOROUGH THIS 5TH DAY OF JULY, 2011. ATTEST: Blankenship, Borough Clerk Yes: No: Absent: i u twit' ..��//�� $ yp,lAssemblyPresident 3 lOE /i // / 8 B 4 I I I f I 1 1 \ \ \ \\\ Haggerty, Johnson, McClure, Murphy, Smalley, Smith, Tauriainen, Knopp Pierce None Ordinance 2011 -21 New Text Underlined; [DELETED TEXT BRACKETED] Kenai Peninsula Borough, Alaska Page 2 of 2 theciyof/ KE AI, ALASKA MEMO: Village with a Past, Ci y with a Fixture" 210 Fidalgo Avenue, Kenai, Alaska 99611 -7794 Telephone: (907) 283 -7535 / FAX: (907) 283 -3014 www.ci.kenai.ak.us TO: City Council FROM: Rick Koch, City Manager DATE: September 14, 2011 SUBJECT: Resolution No. 2011 -69 Authorizing Purchase of Approximately 60 Acres of Lands Owned by the Kenai Peninsula Borough The purpose of this correspondence is to recommend approval of the referenced resolution authorizing the purchase of approximately 60 acres of property from the Kenai Peninsula Borough for public water wells, well head protection, and associated public purposes at less than fair market value in the amount of $2.00. The property is in the general area of the racetrack and facilities operated by the Racing Lions. The property is primarily wetlands upon which any development or expansion of the race track facilities is doubtful. The City's existing primary production well and two future production wells are located to the south of the properties identified. The characteristics of the producing aquifer are such that it is likely the flow of subsurface water passes under the properties. City acquisition of these properties will ensure wellhead protection for the City of Kenai's public water utility. The City Attorney has reviewed the attached Purchase Agreement and has no serious objections or concerns about the proposed agreement. Attachments