Agenda - Council - 10/25/2016 - Laserfiche WebLink

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CC Regular Session 4.5. Meeting Date: 10/25/2016 Submitted For: Patrick Brama,Administrative Services By: Patrick Brama,Administrative Services Information Title Approve Youth First Lease Agreement Purpose/Background: Youth First currently leases 4,820 square feet of office space from the City of Ramsey located at 6701 Highway 10 for$1 per year(essentially for free). The City provides this lease,with favorable terms,to Youth First intentionally--to support their mission and work. Attached to this case is the original lease agreement, drafted by the City's former Attorney Bill Goodrich. The City's new Attorney(2014),Joseph Langel,updated and modified the original lease agreement. Several formatting, wording, and small changes were made to the new agreement(nearly every paragraph has been slightly altered). Listed below are notable lease terms/changes: (1)Rent rate is essentially zero. Youth First is getting the space for free. This term is the same in both the new and original lease agreement. (2)Youth First pays for 30%of utilities--except snow removal. The City covers the cost of snow removal. This is not a new arrangement in practice--the City,and other tenants of 6701,have removed snow for Youth First over the years. Moving forward, staff wanted to clarify this arrangement in the lease agreement. SIDEBAR:staff intends to get a snow plowing contract for all of 6701, and have the bill split three ways:PACT Charter(bus storage), City of Ramsey, and Northern Light Church. (3)The term is five years. The City can terminate this lease with a 90-day notice. In summary, if the City decides to get out of the lease early,the City is not obligated to all five years. The logical circumstance here is--if the property were sold back to the private sector,or if the property was needed for U.S. 10. This term was clarified(stronger language)in the new agreement--in comparison to the original. (4)Typically, the City's lease agreements include a provision related to "destruction of the premises." This clause outlines obligations of both parties in the event the premises is damaged due to weather or a disaster. Typically(as outlined in the original agreement)it's assumed the landlord will in good-faith attempt to repair the property--in the event of a disaster. To avoid any potential perception of the City being obligated to repair 6701 building due to a disaster, in which we rent out for free, staff deleted a majority of said clause in the new agreement(see paragraph 12). If this situation actually occurs,it will be dealt with on a case-by-case basis. (5)Tenant is required to carry a general public liability insurance policy(minimum$2M policy). City carries our standard Hazard Insurance--which is what we do on all leased properties. This arrangement is similar in the new agreement,as was outlined in the original agreement--with more clarification RE the public liability minimums. Notification: NA Observations/Alternatives: