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CR 99-33 Approval of Lease w/ Hennepin Co Railroad Authority 1 Y \ 0 V '" ~ .-".~ ....~ ~ ~? February 5, 1999 ....~.........,..-::ii.-" Council Report 99-033 ~ <0 . o P K \ .... Approval of Lease with Hennepin Co. Reaional Railroad Authoritv Proposed Action Staff recommends approval of the following motion: Motion to approve a lease with the Hennepin County Reaional Railroad Authority for use of an alley between th Avenue North and 8th Avenue North and to authorize Mayor Redepennina and City Manaaer Mielke to execute the lease on behalf of the City of Hopkins. Overview The proposed lease is for use of an alley between yth Avenue North and 8th Avenue North, just north of Mainstreet, for the next 5 years. The property is 45' x 320', and is owned by the Hennepin Co. Regional Railroad Authority. Prior to 1993, the City leased the property from the Authority. The proposed City/public uses of the property are trash hauling and snow plowing. The property is .Of value to the City because it means that the alley on that block is not a dead end for City vehicles. The property also allows vehicular access to private property, access that would be difficult for residents to replace if the property were not available for continued use as an alley. Rent for the property would be $1.00 a year. Primary Issues to Consider . Is the insurance coverage called for in the lease appropriate and in place? . Should the City enter into the proposed lease? Supportina Documents . Draft lease . Map m Parsons, Assistant to the City Manager e - -- - Primary Issues to Consider . . Is the insurance coverage called for in the lease appropriate and in place? Finance Director Lori Yager has indicated that the proposed insurance coverage is appropriate. The property would be added to the list of insured City properties. . Should the City enter into the proposed lease? The property is of value to Hopkins Public Works because it eliminates a dead-end alley. Public Works Director Steve Stadler supports entering into the proposed lease. Staff recommends that the Council approve the proposed lease. Alternatives The Council has the following alternatives regarding this matter: .1. Approve the item as recommended by staff. 2. Amend and approve the item. 3. Continue the item for additional information. 4. Deny the item. 2 . . HENNEPIN COUNTY REGIONAL RAILROAD AUTHORITY Lease No. 73-34011 41 7 North Fifth Street Minneapolis, Minnesota 55401-1362 {612/348-9260} LEASE AGREEMENT FOR VACANT LAND THIS AGREEMENT, entered into by and between the HENNEPIN COUNTY REGIONAL RAILROAD AUTHORITY, a Minnesota political subdivision, LESSOR, and City of Hopkins, 1010 First Street South, Hopkins, Minnesota 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 described as tollows: That part ot the Hennepin County Regional Railroad Authority (HCRRA) Hopkins-to-Victoria right-ot-way, as shown on HCRRA Property Map No.1, sheet 21 of 22, that is between 7th Avenue North and 8th Avenue North, in the City of Hopkins, Minnesota, being approximately 45 teet wide, and encompassing approximately 14,394 square feet. That portion ot the right-ot-way which constitutes the Leased Premises is marked on Exhibit A in pink. Exhibit A is attached and incorporated by reference in this Lease. II. USE OF LEASED PREMISES The Leased Premises shall be tor the use ot LESSEE, its agent?, officers and employees and invitees for the tollowing specified purpose and shall be limited to that specified use: . Trash hauling, school bus turn around, snow plowing, and alley. -- . III. TERM 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-producing use for the Leased Premises during the time required for further planning and development of the light rail transit system or other transportation system. The term of this Lease shall be for a period of sixty - months commencing on April 1,1999, and terminating at 2400 hours on March 31, 2004. LESSOR or LESSEE may terminate this Lease or any renewal, at any time, or for any reason, by giving thirty (30) days' written notice to vacate Leased Premises. Thirty (30) days after service of said notice, this Lease and all rights and obligations hereunder shall terminate except for such rights as may have accrued to either party prior to such termination. At the termination of this Lease, by notice or upon expiration of the Lease term, 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 the same shall belong to the LESSOR; or, in such case, [f the LESSOR so elects, it may, at any time after the termination, tear down and/or remove any or all property at the expense of LESSEE without any liability for damages. LESSEE shall thereupon promptly reimburse LESSOR for all expenses incurred by it in such removal. Upon termination by notice 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 portion 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 One and 00/100 dollars ($1.00) annually for said premises. Such rent shall be due and payable on the first day of each anniversary year of this Lease and shall be delivered in person or mailed to LESSOR at the address set forth in Section XIV. 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. . HCRRA Rev.Lease.Frm./3118/94 2 -- --- . V. MAINTENANCE AND REPAIRS At all times during its occupancy 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, including but not limited to, street repair, trash and snow removal, traffic signage, and weed control and shall use reasonable precaution to prevent waste, damage, or injury. No posters, signs or advertising matter of any kind shall be posted on said premises other than advertisements or signs relating strictly to the business which is being conducted thereon. LESSOR shall not be liable to LESSEE or those 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 Premises by reason of the 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 shall make no alterations, additions, or improvements to the Leased . Premises or modify the use or purpose of the Leased Premises without prior written consent from LESSOR. VI. INDEMNIFICA TION AND INSURANCE A. Indemnification LESSEE shall defend, indemnify, and hold harmless LESSO R, its officials, officers, agents, and employees from any liability, claims, causes of action, judgments, damages, loses, costs, or expenses, including reasonable attorney's fees, resulting directly or indirectly from any act or omission of LESSEE, its contractors, subcontractors, officers, agents, employees, customers or invitees, in the performance of this Lease. B. Insurance In order to protect the LESSOR and those listed above under the indemnification section, LESSEE agrees at all times during the term of this Lease to have and keep in force the following insurance coverages either under a self-insurance program or separate insurance policies: e HCRRA Rev.Lease.Frm./3/18/94 3 ----- . Amounts 1. Commercial General Liability with the following coverages and limits. Contractual liability must be included. General Aggregate $750,000 Products-Completed Operations Aggregate 750,000 Personal and Advertising Injury Aggregate 750,000 Each Occurrence - Combined Bodily Injury and Property Damage 750,000 2. Automobile Liability - Combined $750,000 single limit each occurrence coverage for bodily injury and property damage covering owned, non-owned, and hired automobiles. 3. Workers' Compensation and Employer's Liability: a. Workers' Compensation. Statutory If the contractor is based outside of the . state of Minnesota, coverage must apply to Minnesota laws. b. Employer's 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. Copies of insurance policies or a self-insurance statement 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 for commercial general liability coverage with respect to operations covered under the Lease and as an additional e HCRRA Rev.Lease.Frm./3118/94 4 - ----- . insured with respect to operations covered under the Lease. The certificate should also show that the Hennepin County Regional Railroad Authority will receive 30 days' prior written notice in the event of cancellation, non-renewal, or material change in any described policies. 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. 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. LESSEE agrees that it shall not park any car, truck, equipment, or piece of . machinery which is partially dismantled, non-operating, unlicensed, wrecked, junked, or that which is used only as a source for parts, on the Leased Premises. IX. 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 su bsequent b reach 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. e HCRRA Rev.Lease.Frm./3118/94 5 . x. ENVIRONMENT Al 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, LESSEE's contractors, subcontractors or agents or any sub-lessee's violation of any federal, state or local laws, ordinances, regulations or requirements pertaining to air, water (surface or groundwater) or noise pollution or any toxic, hazardous or solid substances or wastes, pollutants or contaminants, including, without limitation, asbestos, urea formaldehyde, the group of organic compounds known as polychlorinated biphenyls, petroleum products including gasoline, fuel oil, crude oil and various constituents of such products (all of which are hereinafter collectively referred to as "contamination") and the storage, handling, use or disposal of any such material by LESSEE, any sub-lessee, contractor, subcontractor 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 LESSO R discovers any such health or envi ronmental 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. e HCRRA Rev,Lease,Frm./3118/94 6 . XI. 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 contamination and in compliance with all applicable environmental laws, ordinances, regulations and requirements. The provisions of this paragraph shall survive the termination of this Lease. Notwithstanding the foregoing, LESSEE is not responsible, by virtue of the terms of this Lease, for any testing or sampling costs resulting from contamination existing on the Premises prior to LESSEE's use or occupancy of the Premises. XII. 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. XIII. 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. XIV. 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 To LESSOR: Hennepin County Regional Railroad Authority 417 North Fifth Street, Suite 320 Minneapolis, MN 55401-1362 Attention: Director, Hennepin County Regional Railroad Authority . HCRRA Rev.Lease.Frm./3118/94 7 . - -- -- . .----- '. . XV. ACCEPT ANCE LESSEE also accepts said premises subject to any want or failure at any time of LESSOR's title to said premises or any part thereof and LESSEE shall assume any damages sustained by LESSEE in connection therewith. LESSEE also accepts such premises subject to rights of any party, including LESSOR, in and to any existing roadways and easements. LESSEE agrees to provide to LESSOR or other tenants of LESSOR access over and through the premises on these roadways and easements should such access be deemed necessary by LESSO R. LESSEE accepts said premises subject to the right of LESSOR, its employees, agents and contractors to walk upon said premises to repair adjacent property and the right of LESSOR, its employees, agents and contractors to temporarily place equipment upon the leased property for the purpose of maintaining, repairing or inspecting or constructing upon LESSOR's adjacent property. This agreement shall be subject to the rights of all licenses, permits and easements for poles, wires, pipelines, sewers and billboards that exist or may be placed upon, across, above, or underneath the Leased Premises by LESSOR, its employees, agents, licensees and representatives or invitees. LESSOR reserves unto itself, its employees, agents, licensees and representatives the right to place additional poles, wires, pipelines, sewers and billboards upon, across, abover or underneath the Leased Premises and agrees that any such additional placements shall be conducted in a manner . as to not unreasonably interfere with LESSEE's operations thereon. XVI. LIENS AND ENCUMBRANCES LESSEE shall not permit any liens or encumbrances to be established or to remain against the Leased Premises. Liens or encumbrances 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. XVII. SECURITY DEPOSIT LESSEE agrees to deposit with the LESSOR the sum of Zero and 00/100 Dollars ($0.00). Said sum shall be held by LESSOR as security for the faithful performance by LESSEE of all terms, covenants and conditions of the Lease. If LESSEE defaults with respect to any provision of this Lease, LESSOR may use, apply or retain all or any part of this security deposit to remedy the default. If any portion of the deposit is so used or applied, LESSEE shall, five (5) days after written demand by LESSOR, deposit cash with LESSOR in an amount sufficient to restore the security deposit to its original amount and LESSEE's failure to do so shall be a breach of this Lease. LESSOR shall not . HCRRA Rev.Lease,Frm./3/18/94 8 . . be required to keep the security deposit separate from its general funds, and LESSEE shall not be entitled to interest on any such deposit, except as required by statute for residential leases. XIX SUBURBAN HENNEPIN REGIONAL PARK DISTRICT PERMIT AGREEMENT LESSEE agrees that the rights contained on this lease are subject to and subordinate to the rights granted and contained in the Permit Agreement between LESSOR and the Suburban Hennepin Regional Park District (SHPD) A09222 (parcel 73- 34001) dated July 30, 1992 and that LESSEE shall comply with all rules and regulations of the SHPD in regards to the exercise of its rights over LESSOR's right of way, including but not limited to those regarding safety. . . HCRRA Rev.Lease.Frm.1311 8194 9 -. . . LESSEE having signed this Lease, and the Hennepin County Regional Railroad Authority's Commissioners having duly approved this Lease on the day of _, 199_, 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 By: Approved as to form: Chair, Board of Commissioners / l 0 ,. " y~~,- (cc/( '\. Assista'nt County Attorney ) And: //1 Ie. (' Executive Director Date: ') . / / I And: / / Director . LESSEE - CITY OF HOPKINS Approved as to execution: Assistant County Attorney Charles Redepenning, Mayor Date: Date: Steven M. Mielke, City Manager Date: The City is organized pursuant to: Plan A Plan B Charter - - - . HCRRA Rev,Lease,Frm./3/18/94 10 n -- , .. ~. '" (\ \ .. 0." of: ". /" (I' . "'. '., I " '<, . ... "'~. " ".,7 Y 'i(\f;r,/ ''& tc:.'~A .. 'i ~ , ~ :)"~ tIl ',"(' ~~'-l /' ;:l.~~ .)..~' ,>l " -':' .-, . " ~ j. ~ <r ....; \ , .' . . ~ q. .J; 'Ot...... 'I~ ,./ ~ y'>;/. ..... :) =; \~ < / I- /,- ,. ,r. ,.} ..' - . ~ · ~ ..' of,t . CO ~ ..... " , .. it \ ..'. .' ". " \ ~'~ .' .. .... &" ~1:.... ,', - ,', /' ::'!i' . (.I, X ..", " OS, 10 \~ . '(1) - ~ h.,..~ .~. _. ~ . ...,..~ '. ~ . " \ ...;:,. "). ":5. \ ..,' '\\ · 'rid,~ \~~:, '\ \ . .. '. I l ',[ \, . ' ~ ., ",", J , ~ ~ . \\ 10 ~..... :t .~~ : \.. \ \, , . -. - \ ~', ("') ..>: . . \ : - .. ,'," ""'" . c): /'" ' .,...\ ' ',. 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