CR 93-212 Regional Railroad Authority
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December 16, 1993 Council Report 93-212
HENNEPIN COUNTY REGIONAL RAILROAD AUTHORITY
LEASE AGREEMENT
Proposed Action.
Staff recommends adoption of the following motion: "Move to not renew
the lease for that portion of the former railroad right-of-way between
7th & 10th Ave. N. in downtown Hopkins."
This motion will allow the current lease for the railroad right-of-way
between 7th & 10th Ave. N. to terminate.
Overview.
In January, 1984, the City began leasing the 50' wide former railroad
right-of-way in downtown Hopkins between 7th & 10th Ave. N. The lease
between the City and Hennepin County Regional Railroad Authority
(HCRRA) costs $1 per year, and has automatically renewed itself each
year since 1984.
eHCRRA has proposed a new lease with the City which increases the rent
from $1 per year to $400.07 per month.
The Parking Committee discussed this issue on 12-15-93 and unanimously
supported a motion to recommend that the City Council not renew this
lease.
Primary Issues to Consider.
0 What is the level of parking usage in this area?
0 How will the proposed bike trail affect parking in this area?
0 What is the reason for increasing the rent?
0 What does HCRRA intend to do with the property upon
termination of the lease?
0 What are the reasons for the staff recommendation?
Supporting Information.
0 Maps
0 Lease Agreement
0 Letter to HBCA and property owners
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Parking Report 93-3
Primary Issues to Consider.
Based upon the information provided, the City Council has the following
issues to consider:
0 What is the level of parking usage in this area?
Parking usage along the railroad right-of-way between 7th & 8th Ave. N.
is typically quite minimal. Most daytime parking is accommodated in
lots which are immediately adjacent to the right-of-way, such as lot
#700 and #900.
There have been times however, when the right-of-way has been used to
provide alternative parking when repairs or maintenance was being
completed in other municipal lots. This is to avoid overcrowding
certain lots, or forcing daytime parking into the residential areas.
Parking on the right-of-way has likely been reduced over the past year
also because lot #900 was changed to a free, unrestricted parking area.
.The right-of-way is not a high demand parking area primarily because it
is unpaved and not as well lit as the municipal lots. It is for the
most part, a relatively low maintenance area.
0 How will the proposed bike trail affect parking in this area?
In 1994, Hennepin County Parks and Recreation will be constructing a
bike trail along the railroad right-of-way from the Northwest corner of
Hopkins down to 8th Ave. N. This bike trail is proposed to utilize a
fair portion of the right-of-way between 10th Ave. N. & 8th Ave. N. In
order to facilitate the best possible bike trail, it is proposed to
proceed down the middle of the right-of-way at times between 10th Ave.
N. & 8th Ave. N.
The bike trail requires a width of 15'. If the trail were to be
constructed as close as possible to the North or South side of the
right-of-way, there might be the possibility of providing limited
parallel parking on the opposite side. There may be some question as
to the appropriateness of providing parking in such close proximity to
the bike trail.
Hennepin County Parks and Recreation has shown on the proposed plan
ethat a wooden barrier fence is to be constructed in some areas along
the trail where public parking could be accommodated.
Attached is a copy of the proposed bike trail in the area between 8th
and 10th Ave. N. You will note that the trail between 9th Ave. N. and
10th Ave. N. may allow for parallel parking along the North edge of the
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Parking Report 93-3
right-of-way. However, between 8th Ave. N. and 9th Ave. N. there
appears to be very limited area which would remain available for
parking.
The trail is proposed to end at 8th Ave. N. and proceed South from that
point. Therefore it will not have any affect on the right-of-way
between 7th Ave. N. and 8th Ave. N.
0 What is the reason for increasing the rent?
HCRRA has proposed a rent increase from $1 per year to $400.07 per
month ($4,800.84 per year) for the use of the right-of-way. The
proposed rent relates directly to the amount of a storm sewer runoff
charge which Hennepin County is billed by the City each year. A storm
sewer runoff charge is paid by everyone who owns property in the City
of Hopkins. Hennepin County has directed HCRRA to increase the rent
for right-of-way property so that they can recoup this storm sewer
runoff charge.
0 What does HCRRA intend to do with the property upon termination of .
the lease?
It is somewhat unclear as to what Hennepin County will do with the
right-of-way between 7th and 10th Ave. N. in the event the City
terminates the lease agreement. It is clear that Hennepin County would
become the responsible party for maintenance of this area, as well as
handling complaints of junk cars and other issues which may arise.
Hennepin County may, in order to keep these types of nuisance issues to
a minimum, choose to construct a barrier of some type to keep vehicles
out of this area. They have constructed "bollards" in other
rights-of-way in the City for this purpose.
Another alternative which HCRRA has discussed is to attempt to rent
this area to a local commercial user for parking purposes. For
example, Rudy Luther's currently rents the right-of-way between 6th
Ave. N. & 7th Ave. N. for this purpose. It would then become the
responsibility of the renter to keep other vehicles from parking in
this area, and to monitor upkeep and maintenance.
Due to the fact that the bike trail is proposed to be constructed in
1994, it would appear unlikely that the County would complete any types
of major changes to this area, such as constructing bollards, at least e
until the bike trail has been completed.
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Parking Report 93-3
0 What are the reasons for the staff recommendation?
Staff is recommending the lease not be renewed for the following
reasons:
0 Cost is extraordinarily high
0 Use of this area for public parking is low
0 Bike trail will likely inhibit a majority of public
parking between 10th Ave. N. and 8th Ave. N. when
constructed in 1994.
Alternatives.
1) Approve staff recommendation.
2) Motion to renew lease at $400.07 per month. The lease will
likely have to be either renegotiated or terminated at the
time the bike trail is constructed in 1994.
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'~ . HENNEPIN COUNTY REGIONAL RAILROAD AUTHORITY Lease No. 73-34911
Southwest Street Level, Government Center
Minneapolis, Minnesota 55487-0016
(612/348-9260)' ..
I LEASE AGREEMENT
THIS AGREEMENT, entered into by and between the HENNEPIN COUNTY
REGIONAL.RAILROAD AUTHORITY, a Minnesota political subdivision, LESSOR, and..citI
. of Houkins. 1010 First $trcet South. Hopkins. MN . 55343, LESSEE;
In consideration of the covenants by and between the parties, IT IS HEREBY
AGREED:
I. LEASED PREMISES
. LESSEE agrees to lease from LESSOR, and LESSOR agrees to lease to LESSEE, that
certain property descrihed as follows:
That part of the Hennepin County Regional Railroad Authority right of
way located between 7th Avenue North and 10th Avenue North, exclusive
of the bike trail, in the City of Hopkins, as shown in pink on the attached
exhibit map. .
U. USE OF LEASED PREMISES
The Leased Premises shall be for the use of LESSEE, its agents, officers and employees .
and invitees for the following specified purpose and shall be limited to that specified use:
Parking.
In. TERM, OPTION TO RENEW, AND TERMINATION
LESSEE acknowledges that the Leased Premises were acquired by LESSOR specifically
and solely for the purpose of constructing a light rail transit system and its associated facilities and
that it is LESSOR's intention to lease the Leased Premises only until they are needed for that
purpose. Nothing in this Lease shall be deemed to evidence any change by LESSOR of its
. intended use of the Leased Premises for light rail transit purposes or other permitted transportation
.. purposes. Rather, LESSOR has agreed to the terms of this Lease to provide a temporary income-
HCRRA 2 1
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I producing use for the Leased Premises during the time required for further planning an.
development of the light rail transit system or other transportation purposes.
The term of this Lease shall be for a period of thirty-six l1lonth~ commencing on
.!anuary. 1, 1994. and terminating at 2400 hours on .Pecember 31. J..997.
LESSOR or LESSEE may terminate this Lease or any renewal, at anytime, by giving
thirty (30) days' written notice to vacate Leased Premises. Thirty (30) days after seIVice of said
notice, this Lease and all rights hereunder shall terminate except for such rights as may have
accrued to either party prior to such termination. At the expiration of thirty (30) days, without
further notice or demand, LESSEE shall deliver possession of the Leased Premises to the LESSOR
and shall remove all property placed upon the Leased Premises which it desires and has the right
to remove. If it shall fail to remove such property, its right to do so shall cease at the option of
the LESSOR, and LESSEE's title thereto shall be forfeited and tbe same sball belong to the
LESSOR; or, in such case, if the LESSOR so elects, it may, at any time after the tennination, tear
doWn and/or remove any or all property at the expense of LESSEE without any liability for
damages. LESSEE shan thereupon promptly reimburse LESSOR for all expenses incurred by it
in such removal.
Upon such termination of this Lease, rent shall be paid by the LESSEE to the date of
termination fIXed by said notice, and if rent has been paid in advance, LESSOR shall refund to
LESSEE the unearned ponion for the period extending beyond such date of termination, and .
LESSEE shall have no further rights under this Lease. .
IV.. RENT
LESSEE agrees to pay to LESSOR the sum of .Fo1!1 hu~dred and 07/100 dollars
($400.07) monthly for said premises. Such rent shall be due. and payable on the first day of each
month of this Lease and shall be delivered in person or mailed to LESSOR at the address set forth
in Section XV. LESSEE pays all costs for water, sewer, heat~and electricity and any other utilities,
if any, used or consumed in connection with the Leased Premises, including waste or trash removal
costs and snow plowing.
V. MAINTENANCE AND REPAIRS
At all times during its occupan(.j' of the Leased Premises, LESSEE shall be responsible
for 100 percent of the expense of maintaining the Leased Premises and the fixtures and equipment
in good repair; and shall use reasonable precaution to prevent waste, damage, or injury; and shall
modify, repair, or replace equipment when necessary.
LESSOR shall not be liable to LESSEE or tbose claiming by, through, or under
LESSEE for any injury, death, or property damage occurring in, on, or about the Leased Premises.
Without limitations of the foregoing, LESSOR shall not be liable for any loss or damage which may
be sustained by LESSEE or others in, about, or adjacent to the Leased Premi~es by reason of the .
HCRRA 2 2
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present or future condition of repair of the Leased Premises, or for loss or damage arising from
the acts or omissions of LESSEE or other tenants or occupants.
LESSEE will make no alterations, additions, or improvements to the exterior of the
building or design or structure of the Leased Premises or modify the use or purpose of the Leased
Premises without prior written consent from LESSOR.
VII. INDEMNIFICATION AND INSURANCE
A. Indemnification
LESSEE shall defend, indemnify, and hold harmless LESSOR, its Commissioners,
officers, agents, and employees from any liability; claims, damages, costs, judgments, or expenses,
including reasonable attorney's fees, resulting directly or indirectly from a negligent or intentionally
wrongful act or omission of LESSEE, its contractors, subcontractors, agents, employees, customers
or invitees, in the ,performance of this Lease.
B. Insurance
In order to protect itself, as well as LESSOR under the indemnity provisions
e hereinabove set forth, LESSEE or LESSEE's contractors, subcontractors or agents performing work
on the premises shall purchase and maintain in force at all times during the term of this Lease the
following minimum insurance coverages applicable to the Leased Premises, affiliated activities,
and! or this Lease:
Limits
1. Commercial General Liability to include the follow-
ing coverages and insurance limits. Contractual
Liability coverage must be included.
General Aggregate $1,000,000
Products-Completed Operations Aggregate 1,000,000
Personal and Advertising Injury 1,000,000
Each Occurrence - Combined Bodily Injury and
Property Damage 1,000,000
Fire Damage - Any One Fire 50,000
Medical Expense - Per Person 5,000
2. Automobile Liability including owned, non-owned,
and hired automobiles.
Combined Bodily Injury and Property Damage $1,000,000
. 3. ,Workers' Compensation and Employers' Liability
HCRRA 2 3
. -~------'
n
.' -<..:',,'"'
.
a. Workers' Compensation - Statutory.
If the contractor is based outside of the
State of Minnesota, coverage must apply
to Minnesota laws.
b. Employers' Liability. Bodily injury by:
Accident - Each Accident $100,000
Disease - Policy Limit 500,000
Disease - Each Employee 100,000
An umbrella or excess policy over primary liability coverages is an acceptable method
to provide the required insurance limits.
The above establishes minimum insurance requirements. It is the sole responsibility
of the LESSEE to determine the need for and to procure additional coverage which may be needed
in connection with this Lease. All insurance policies shall be open to inspection by the LESSOR,
and copies of policies shall be submitted to the LESSOR upon written request.
This Lease shall be valid when the LESSEE has obtained required insurance and filed
an acceptable certificate of insurance with the Authority. The certificate shall: .
. Name Hennepin County Regional Railroad Authority as certificate holder and
as an additional insured with respect to operations covered under the Lease for
all liability coverages except Workers' Compensation and Employers' Liability.
. List any exceptions to the insurance requirements.
. Amend the certificate of insurance to show Hennepin County Regional Railroad
Authority will receive 30 days written notice in the event of cancellation, non-
renewal, or material change in any described policies. Delete the wording:
"Endeavor to" and "but failure to provide such written notice shall impose no
obligation or liability of any kind upon the company its agents or'representatives."
All certificates of insurance shall provide that the insurance company shall give thirty
(30) days' written notice to both LESSEE and LESSOR of cancellation, non-renewal, or any
material changes in the policy and certificates of insurance shall so state.
VII. ASSIGNMENT AND SUBLETTING
LESSEE shall not, except with the prior written consent of LESSOR, assign, sublet,
mortgage, pledge, or in any manner transfer the Leased Premises or this Lease.
.
-
. HCRRA 2 4
" :::~
,-
.
VIII. COMPLIANCE WITH LAWS, ORDINANCES, AND RULES
LESSEE agrees to comply with all laws, ordinances, and regulations of federal, state,
municipal and local government agencies as they apply to its occupancy of the Leased Premises
and/or the business it transacts on the Leased Premises. LESSEE shall comply with any
reasonable rules adopted by LESSOR for the safety, care, and cleanliness of the Leased Premises
and for the preservation of good order therein and shall at all times keep the Premises clear and
safe. LESSEE shall not permit the existence of any nuisance on said Premises.
IX. TRADE FIXTURES, MACHINERY, AND EQUIPMENT
LESSOR agrees that all trade fixtures, machinery, equipment, furniture, or other
personal property kept or installed on the Leased Premises by LESSEE shall not become the
property of LESSOR and may be removed by LESSEE, subject to LESSOR's rights as set forth in
Section III. .
LESSEE agrees that it shall be fully responsible for the repair of any damage to the
Leased Premises caused by the removal of any of its trade fixtures, machinery, equipment,
furniture, or other personal property.
. X. REMEDIES OF LESSOR
It is further agreed between the parties hereto, that if the said LESSEE shall breach
or make default in any of the conditions, covenants or agreements of this Lease, which breach or
default shall continue for fifteen (15) days after LESSEE's receipt of written notice thereof from
LESSOR, then it shall be lawful for the LESSOR, then or at any time thereafter, to declare this
Lease ended, and to re-enter said premises and take possession thereof and to use any reasonable
or necessary lawful force for regaining possession; whereupon the rights and obligations of the
parties shall be the same as above specified in the case of termination at the end of thirty (30)
days' notice; and it is hereby further agreed and provided that any waiver at any time of a breach
of any condition, covenant or agreement of this Lease shall extend only to the particular breach
so waived and shall, in no manner, impair or affect the existence of such condition, covenant or
agreement, or the right of LESSOR thereafter to avail itself of same and any subsequent breach
thereof. In the event LESSOR has to take action for repossession of said property, LESSEE, its
assigns or heirs shall be liable for reasonable attorney's fees incurred by LESSOR.
XI. ENVIRONMENTAL CONCERNS
LESSEE shall not create or permit any condition of the premises that could present a
threat to human health or to the environment. LESSEE shall defend, indemnify and hold harmless
LESSOR and its affiliates from any suit Or claim growing out of any damages alleged to have been
caused by, contributed to, or aggravated by the violation by LESSEE, or any sub-LESSEE,
. contractor, sub-contractor or agent of LESSEE of any federal, state or local laws, ordinances,
regulations or requirements pertaining to solid or other wastes, chemicals, oil and gas, toxic,
HCRRA 2 5
t.". ,....~
.
corrosive, or hazardous materials, air, water (surface or groundwater) or noise pollution, and the
storage, handling, use or disposal of any such material by LESSEE or any sub-LESSEE, contractor,
sub-contractor or agent of LESSEE performing work on or from the Premises. LESSEE shall bear
the expense of all practices or work, preventative, investigative or remedial, which may be required
because of any conditions of the Premises caused by LESSEE or any use of the Premises by
LESSEE or those claiming by, through, or under LESSEE, during LESSEE's period of occupancy
or during LESSEE's ownership or use prior to the date of this Lease: LESSEE expressly agrees
that the indemnification defense and hold harmless obligations it hereby assumes shall survive
cancellation of this Lease. LESSEE agrees that statutory limitation periods on actions to enforce
these obligations shall not be deemed to commence until LESSOR discovers any such health or
environmental impairment, and LESSEE hereby knowingly and voluntarily waives the benefits of
any shorter limitation period.
LESSOR shall have the right, but not the duty, to enter upon the Premises from time
to time as set forth below to inspect the premises for environmental contamination and in the
course thereof to conduct soil and groundwater testing. LESSOR may enter the Premises during
regular business hours of LESSEE without prior notice, and may enter the Premises during periods
other than regular business hours either with prior written consent of LESSEE or without if
LESSOR reasonably believes that an emergency exists on the Premises. LESSOR shall conduct
any such inspections or testing so as to minimize interference with LESSEE's business operations.
LESSOR's entry onto the Premises pursuant to this paragraph shall not relieve the LESSEE's .
obligation to pay rent under this Lease.
Notwithstanding the foregoing, LESSEE is not responsible, by virtue of the terms of this
Lease, for any contamination existing on the Premises prior to LESSEE's use or occupancy of the
Premises.
XII. TESTING PROVISION
At the request of LESSOR, upon the termination of the Lease, or during the term
hereof, LESSEE shall pay for the services of a state-approved contractor to sample what appears
to be any visibly contaminated areas of the premises. For any contaminated areas, LESSEE's
contractor shall provide remediation recommendations to LESSOR, and shall perform remediation
to the satisfaction of LESSOR. Copies of the results shall be forwarded to LESSOR by LESSEE
to ensure that the premises are returned to LESSOR reasonably free of pollution and in
compliance with all applicable state and federal laws and regulations. The provisions of this
paragraph shall survive the termination of this Lease.
.
XIII. RIGHT OF ENTRY
LESSOR may enter the Leased Premises at any time to examine, inspect, or protect
the premises and to make alterations, renovations, or repairs.
.
.
HCRRA 2 6
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XIV. AMENDMENTS
No waivers, alterations or modifications of this Lease or any agreements in connection
therewith shall be valid unless in writing duly executed by both LESSOR and LESSEE herein.
XV. NOTICES
All notices required or permitted pursuant to this Lease shall be directed to the
following individuals and shall be either hand-delivered or mailed to the following addresses:
To LESSEE: City of Hopkins
1010 First Street South
Hopkins, MN. 55343
Attention: Steven M. Mielke, City Manager
To LESSOR: Hennepin County Regional Railroad Authority
Southwest Street Level
Government Center
Minneapolis, MN 55487-0016
,_ Attention: Don Lawrence
XVI. ACCEPTANCE
LESSEE understands that the premises are a former railroad right of way and may
contain certain pollutants that may be hazardous to human health. LESSEE accepts the premises
. with the full knowledge that this potential hazard may exist.
XVII. LIENS AND ENCUMBRANCES
LESSEE shall not permit any liens or encumbrances to be established or to remain
against the Leased Premises. Liens or encum9rances for purposes of this section mean any
mortgage, pledge, security interest, lien or encumbrance on (or affecting) any portion of the Leased
Premises, including (without limitation) tax liens or encumbrances and liens or encumbrances with
respect to work performed or equipment or material furnished in connection with LESSEE's use
of the Leased Premises.
.
HCRRA 2 7
.
..... ..
.
LESSEE having signed this Lease, and the Hennepin County Regional Railroad
Authority's Commissioners having duly approved this Lease on the _ day of
_, 1993, and pursuant to such approval, the proper officials having signed this Lease, the parties
hereto agree to be bound by the provisions of this Lease.
HENNEPIN COUNTY REGIONAL
RAILROAD AUTHORITY
Upon proper execution, this
agreement will be legally
valid and binding. ~y:
Chair, Board of Commissioners
Assistant County Attorney And:
Date: Executive Director
Approved as to execution: LESSEE - CITY OF HOPKINS e,
Assistant County Attorney Steven M.Mielke, City Manager
Date: Date:
The City is organized pursuant to:
.
Plan A Plan B Charter
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HCRRA 2 8
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C I T Y 0 F H 0 P K I N S
December 1, 1993
Mark Senn
Hopkins Business & Civic Association
10550 Wayzata Blvd. .
Hopkins, ~ 55343
Mark:
As you might be aware, the City of Hopkins currently leases a portion of the former Railroad
right-of-way located between 7th Ave. N. and 10th Ave. N. for the purpose of public parking.
The lessor, Hennepin County Regional Railroad Authority, has proposed a new lease to the City
which would increase the annual rent from $1 per year to $4.901.88 per year. HCRRA has
proposed the increase in response to an annual billing in the amount of$4,901.88 which the
. County receives from the City for storm sewer runoff charges.. A stonn sewer runoff charge is
paid by everyone who owns property in the City of Hopkins.
City Staff is intending to recommend that the City not renew this lease due to the excessive cost.
Additionally, the Hennepin County Parks Department will be constructing a bike path along this
Railroad right-of-way in the summer of 1994. The bike path as proposed will utilize a
considerable portion of the right-of-way, thereby leaving very little which would be usable for
public parking purposes.
This information is being provided to you for your comment, or to receive input from the HBCA
general membership, if you feel that is appropriate. The Parking Committee will be taking action
on this item at their meeting on December 15, 1993,6:30 p.m., in the Raspberry Room at City
Hall. Anyone who is interested in commenting is welcome to attend.
Feel free to call me if you have any questions, or would like any additional information.
Sincerely,
~~
. Paul T. Steinman
Community Development Specialist
enc. - Map
1010 First Street South. Hopkins. Minnesota 55343 612/935-8474
An Equal Opportunity Employer. ~ <- ~,-~ -,.----- --'- --.~..
jST.5i: IJ. ~~ ~-.,>.
901
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December 8, 1993 30 <j{ ~ If p-l!. . J.J .
1.(6 "
-
-
er:
As you might be aware, the City of Hopkins currently leases a portion of the former Railroad
right-of-way located between 7th Ave. N. and 10th Ave. N. for the purpose of public parking.
The lessor, Hennepin County Regional Railroad Authority, has proposed a new lease to the City
which would substantially increase the annual rent.
City Staff is intending to recommend that the City not renew this lease due to the excessive cost.
Additionally, the Hennepin CountyParks Department will be constructing a bike path along this
Railroad right-of-way in the summer of 1994. The bike path as proposed will utilize a .
considerable portion of the right-of-way, thereby leaving very little which would be usable for
public parking purposes.
If you would like to provide your comments on this issue, please feel free to attend the Parking
Committee meeting which will be held on December 15, 1993,6;30 p.m., in the Raspberry Room
at City Hall. Once the Parking Committee has taken action on this item, it will then proceed to
the City Council on December 21 for final approval.
If you cannot attend the meeting, but would like to provide your input on this issue, please call me
here at City Hall at 935-8474.
Sincerely,
~~ -
Paul T. Steinman
Community Development Specialist
enc. - Map
.
--,
-.............., ~