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HomeMy WebLinkAbout1973-07-31; City Council; 2109; RI-CITY AUTO DEALERS ASSOCIATION LEASE AGREEMENT. f., - ^ h — 6* — / T /? £ CITY v«/O F C A K I, S B A D ,--*• CALIF'OKWJA C.C. Meeting Aug. 7,1973' Agenda Bill Aro . <s3/£ ? Date; July 31 , 1973 •Referred To: Subject: . Submitted By: Revision of Tri-City Auto Dealers Association Lease-Leaseback Agreement with City for Plaza City Attorney Del Norte Road. Statement of the .'-latter At the present time the City is a party to a lease-leaseback agreement with the TM-City-Auto Dealers Association which provides for the" construction of Plaza Del Norte Road. The City is obligated to lease said road for ten years at $43,296.00 per year beginning on the date the road is accepted by the City and placed in use by the public. Engineering report-s that the road is ready to be placed in full service and.it seems appropriate that the Council act now to accept the road. The payment specified in the agreement is intended to reflect a fair market rental for the road. Of necessity that figure was based in part on estimates of the cost of construction. As reflected in .the memorandum of understanding between the Association and the City., both parties understood that it might be necessary to more accurately ascertain the fair market rental after the construction was complete. The City Manager and his staff have completed a final review of the eonstri/ctio-n -costs and agreement has -been reached in that regard with the Association. Said review indicates that an upward revision of the rental payment is necessary primarily resulting from a change in the scope of improvements to include the installation of water and sewer lines in the road. It will be necessary to amend the lease-leaseback agreement to reflect the increased amount. The manager has determined it to be in the best interests of the City to recommend that the manner of payment and the term also be amended. The agreement now provides for quarterly payments for. a ten year and eleven month period. The manager recommends a -ten year term to commence July 1, 1973, and a monthly payment. An amendment to the agreement is required to effectuate' his recommendation. The amendment has been prepared and the resolution attached hereto will authorize its execution. The attorney for the Association concurs in the amendment. . • Exhibit, 1. Amendment to. Lease-Leaseback Agreement 2. City Council Resolution No. 3 /^Authorizing Execution of Amendment. Staff Recommendations _ Ap. _ / / _3T" Z*— #^c> Zf&m ?C? recommendation of Public Works Department and place Plaza Del Norte Road in full public use. Adopt Resolution No.3j_f^_authori zing the execution of an amendment to the lease-leaseback Agreement to provide for a monthly payment of $ for a ten year term-commencing July 1, 1973. Wo C.C ^Meeting Aug. 7, 1973 PateT July 31, 1973 i ty Manager's Recommendation • • The subject matter of this agenda bill'has been under discussion for many hours with Mr. Robert Knauf,- Attorney, representing the . automobile dealers'; City Manager, City Attorney, Finance.-Of ficer, Public Works Director and Engineers representing the City. All official documents .were discussed and analyzed, all figures were analyzed and justified, and all elements of the matter were discussed-. The staff recommendations are the result of study, negotiations and analysis and the City Manager concurrs. with the recommendations set forth under staff recommendations. • .- - Co unci1'Action -2- SECOND AMENDMENT TO AGREEMENT FOR LEASE. LEASEBACK. OPTION TO BUY This amendment to an agreement dated November 21, 1972, is made and entered into this day of August, 1973, by and between the parties to said agreement. Recitals: 1. Pursuant to a mutual understanding, City and Association undertook a review of the fair market rental value of the leaseback premises. Said review indicates a revision of the yearly rental is in order which City and Association desire to effect. 2. Said review also indicated that adjustments of the term and frequency &f payment were desired by City and acceptable to Association. Amendment to Agreement: 1. Section III, Term and Renewal, page 3, subsection "A" is amended to read as follows: "The term of this leaseback shall commence on July 1, 1973, and shall run from that date to June 30, 1983." 2. Section IV, Rent, page 4, subsection "B" is amended to read as follows: "Rent shall be payable monthly in advance. The first payment of $ is due and payable on July 1, 1973. The subsequent monthly payments of $ ; per month shall be due and payable on the first of the month. 1. Consideration for each month's rent is the use for that month by the City and the public of the leaseback premises." THE CITY OF CARLSBAD By: David M. Dunne, Mayor TRI-CITY AUTO DEALERS' ASSOCIATION David Rorick, Jr.J. B. Finney, Jr., Chairman V. R. Dixon R. H. Brooking Charles B. Weseloh Donald D. Sharp 2. zIU 0 < 1 2 3 4 5 6 7 8 9 10 11 12 13 14 00 g 15 Ol ;| 16 | 17 ;§ 18 CO35 19 20 21 22 23 24 25 26 27 28 29 30 31 32 RESOLUTION NO. 3192 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF CARLSBAD, CALIFORNIA, AUTHORIZING THE MAYOR TO EXECUTE A SECOND AMENDMENT TO THE AGREEMENT WITH THE TRI-CITY AUTO DEALERS ASSOCIATION MODIFYING THE FAIR MARKET RENTAL FOR PLAZA DEL NORTE ROAD AND THE TERM AND FREQUENCY OF PAYMENTS THEREFOR. WHEREAS, pursuant to a mutual understanding and agreement, the parties to the November 21, 1972, agreement for the lease-leaseback of certain properties and the construction thereof of Plaza Del Norte Road, undertook to review said agreement in order to determine whether or not the rental payment provided for in said agreement would, in fact, reflect the fair market rental value of the leaseback premises; and WHEREAS, said review has resulted in a mutual agreement that an upward revision in the rental payment is necessary resulting primarily from an increase in scope of the improvements constructed on the leaseback premises; and WHEREAS, the parties are also in agreement that the term of said agreement and the frequency of payments thereunder also needs revision; NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Carlsbad as follows: 1. That the above recitations are true and correct. 2. That the Mayor is hereby authorized to execute on behalf of the City a second amendment to the November 21, 1972, agreement between the City of Carlsbad and the Tri-City Auto Dealers Association. Said amendment to be in a form as contained in Exhibit "A" attached hereto and incorporated by reference herein. PASSED, APPROVED AND ADOPTED at a regular meeting of the City Council on the day of August, 1973, by the 1 . o: < It> H 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 following vote, to wit: AYES: NOES: ABSENT: DAVID M. DUNNE, Mayor ATTEST: MARGARET E. ADAMS, City Clerk (seal) 2.