Minutes - Council - 06/13/2006 - Laserfiche WebLink

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Motion carried. Voting Yes: Mayor Gamec, Councilmembers Elvig, Cook, Jeffrey, Olson, and Pearson. Voting No: None. Absent: Councilmember Strommen. Case #9: Consider Leases for Property at 6745 Highway 10 (Anchor's Away Building) City Attorney Goodrich indicated the City is in the process of purchasing the property at 6745 Highway 10, known as the Anchor's Away building through the RALF Funds Program. Final Met Council and MnDOT approval is expected shortly. Two businesses currently are leasing space in the building from Ramsey Town Center, LLC, the present owner. The businesses are Quick Lube car repair and car wash and cold storage for Boat/RV storage. The two tenants would like the City to approve leases for their currently occupied spaces. The Quick Lube lease would be with Verns Ventures, Inc. Mr. Goodrich reviewed the terms of the lease with Verns Ventures, Inc. Councilmember Jeffrey inquired if there is concern regarding liability for hazardous material spills and clean-up on the Quick Lube site. City Attorney Goodrich replied staff is not aware of any spills on the site, but the tenant would be liable for anything of this nature on the site. Mayor Gamec questioned if the City would be reimbursed for the cost of the leasing agent prior to the proceeds going to the Met Council. City Attorney Goodrich replied the net proceeds will go to the Met Council; the City will not pay for anything with the leasing. He eXplained this is unique with the property being leased back to the property owner, and Met Council is not quite sure how to fit this into their program. He advised the City will receive a certain amount of money when they pay for the property that will pay for their expenses, such as legal and appraisal fees. Councilmember Cook expressed his support for this lease. He stated it puts money back in to the RALF funds and allows the City to work towards more properties being closed on and getting the properties on this alignment purchased; as long as the Met Council works with the City to be sure they don't incur any costs with these leases. Motion by Councilmember Jeffrey, seconded by Councilmember Cook, to approve a Lease Agreement with Verns Ventures, Inc., for 5,266 square feet of the building located at 6745 Highway 10 upon the terms and conditions of the Lease Agreement reviewed and amended by City Council, subject to City Attorney approval; and to approve a Lease Agreement with K & K Sharp, LLC for 11,200 square feet of the building located at 6745 Highway 10 upon the terms and conditions of the Lease Agreement reviewed and amended by City Council, subject to City Attorney approval. Further discussion: City Attorney Goodrich advised the K & K Sharp lease is more troublesome, as the City has set a precedent with the NAU building by permitting the tenant not to pay the taxes; that is creating issues with other buildings they are leasing. He would advise that the City Council / June 13,2006 Page 21 of 26