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options. Staff was also negotiating for committing operation of the ski <br />hill for 5 years but Waste Management made a good point in that it does not <br />make sense to continue operating a facility that may not be economically <br />viable. <br /> <br />Section 4.03 of Article IV states that the City shall Cooperate with the <br />Developer to obtain the remaining governmental approvals necessary for <br />development of the Project (Project defined includes Development Property <br />and Improvements) and the City shall not take any action that would prevent <br />or increase the costs of construction or operation of the Vertical <br />Expansion and/or the Improvements. With this language, the City would <br />waive it's right to govern in the best interest of the citizens. <br /> <br />It occurred in negotiations that the use of the ski hill hinges on the <br />amount of snowfall and that snow-making equi~ent would be essential to any <br />successful ski hill operation. Article V of the agreement states that if <br />after two years there is not at least 90 days of sufficient snow for <br />skiiing, the Developer will install snow-making equi~ent at a cost of at <br />least $25,000. If that snow-making equipment is installed, it will be <br />considered a part of Project Costs. If PCA does not permit additional <br />moisture being placed on the vertical expansion because of leachate <br />concerns, this condition in the agreement is useless and perhaps there will <br />be very limited use of the ski hill. <br /> <br />In the event the ski hill does not go forward, and that election has been <br />made by Waste Management based on economic events, the Developer will be <br />obligated to pay the City $50,000 less Project Costs to date. Note, a city <br />cannot sell a conditional use permit under any circumstances and staff has <br />been trying to avoid this $50,000 condition. If the ski hill does not go <br />forward because of pending or threatened litigation, the Developer is not <br />obligated to pay the City $50,000. Note, if the Project is in it's full <br />development stage with the ski slope, tow rope, warming house and <br />snow-n~king equipment in place, and the project does not go forward, there <br />most likely won't be any remaining balance of that $50,000 to pay the City. <br />The City would then have the option to take the project over and operate <br />it. The City could also enter into an agreement to take the project over <br />whether it 'breaks-even' or not. <br /> <br />Article VI defines the events of default for the Developer and the City. <br />If the City does not perform all of it's obligations, the Developer can: <br />a) suspend performance under the agreement; b) go to court and obtain <br />specific enforcement of the terms of the agreement; terms that would <br />include the requirement for the City to 'cooperate'; c) if the City <br />defaults after the Developer commences construction and proceeds with <br />Vertical Expansion, the City shall pay the developer an amount equal to the <br />Project Costs incurred by the Developer prior to the event of default as <br />liquidated damages; d) take whatever action is necessary to enforce the <br />City's performance under the agreement. <br /> <br />Article VII includes provisions for arbitration. If there is a <br />disagreement regarding interpretation of the agreement, the City and the <br />Developer have the option to enter into arbitration. Arbitration is a <br />quicker and less expensive method for getting matters resolved. <br /> City Council/March 9, 1988 <br /> <br />Page 6 of 14 <br /> <br /> <br />