HomeMy WebLinkAbout7037_CCv0001.pdf RESOLUTION NO. 7037
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF REDLANDS AUTHORIZING
APPROVAL AND EXECUTION OF LEASE AGREEMENTS FOR WATER STOCK
WITHOUT PRIOR COUNCIL APPROVAL.
WHEREAS, the City derives the majority of its water supply from three primary sources:
the Santa Ana River, Mill Creek, and groundwater wells, and the right to use surface water
sources has been acquired by the City through both direct ownership of water rights and through
the ownership of mutual water company stock; and
WHEREAS, at certain times in the past, the City has entered into lease agreements to
either lease shares of Crafton Water Company stock to, or lease shares of Bear Valley Mutual
Water Company stock from, others, depending on the forecasted availability of water from a
particular surface water source and the amount of water stock owned by the City at that time; and
WHEREAS, the City has entered into such lease agreements with local water companies
to allow the City to receive surplus high quality water from mutual water company shareholders
at reduced cost, and as lessee pursuant to these agreements, the shareholders, as Iessees, may put
to lease final use surplus high quality water not then needed by the City, are required to pay all
assessments and delivery charges for such water; and
WHEREAS, in May of 2007, the City Council by minute motion authorized the approval
of annual water share leases without prior Council approval, and staff is recommending the
approval of this Resolution to memorialize that past action;
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Redlands as
follows:
Section 1. The City Council of the City of Redlands hereby authorizes the Mayor, or any
Councilmember, to execute annual leases for Grafton Water Company and Bear Valley Mutual
Water Company shares, substantially in the forms hereto as Exhibits "A"and "B," respectively.
ADOPTED, SIGNED AND APPROVED THIS 17th DAY OF MAY, 2011.
Mayor of the City of Redlands
ATTEST:
A
/
•
City Clerk of th- City of Redlands
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I, Sam Irwin, City Clerk of the City of Redlands, hereby certify that the foregoing
resolution was adopted by the City Council at a regular meeting thereof held on the 17th
day of May, 2011 by the following vote:
AYES: Councilmembers Harrison, Bean, Foster, Gardner; Mayor Aguilar
NOES: None
ABSTAIN: None
ABSENT: None
)1.‘
City Clerk
ucclerk\Resolutionsaes 7000-7999\7037 Water Lease Agreement.doc
EXHIBIT "A"
Shares Lease Agreement
(City As Lessor)
This Shares Lease Agreement ("Lease") is entered into the day of
201 , ("Effective Date") by and between the City of Redlands, a general law city incorporated
under the laws of the State of California("Lessor") and ("Lessee"). Lessor
and Lessee are sometimes individually referred to herein as a "Party" and, together, as the
"Parties."
RECITALS
WHEREAS, Lessor is the owner of shares of the common stock of the Crafton Water
Company; and
WHEREAS, Lessee desires to lease from Lessor shares of the common stock of
the Crafton Water Company (the "Leased Shares") on the terms and conditions hereinafter set
forth;
NOW, THEREFORE, in consideration of the mutual promises contained herein, Lessor and
Lessee agree as follows:
AGREEMENT
1. Lease. Lessor hereby agrees to lease the Leased Shares to Lessee and Lessee
agrees to lease the Leased Shares from Lessor for the purpose of providing water to Lessee.
Such water is not intended, nor shall it be used for human consumption or domestic purposes
until such time that Lessee treats such water in accordance with California Department of Health
Services, Office of Drinking Water Standards, and all other applicable state and local laws, rules
or regulations.
2. Term. This Lease shall commence on the Effective Date and shall terminate on
, unless earlier terminated. Lessee understands and agrees that neither this
Lease, nor any of the rights and obligations of the Parties to this Lease, shall extend beyond the
Lease Term.
3. Rent.
A. As rent for the Leased Shares, Lessee shall pay Lessor, an amount equal to the
total number of Leased Shares multiplied by One Dollar ($1.00), together with an amount equal
to the Crafton Water Company's annual per share stock assessment as reimbursement to Lessor,
if Lessor has paid such annual assessment for this calendar year ("Rental Amount"), and a One
Hundred Dollar($100) administration charge established by Lessor.
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B. If Lessor has not paid the annual assessment for the Leased Shares for the
calendar year prior to the Effective Date of this Lease, the Rental Amount shall not include any
reimbursement payment. In such event, Lessee shall be obligated to pay the annual assessment
for the Leased Shares directly to the Crafton Water Company.
C. Lessee shall be obligated to pay for all water delivery charges imposed by
Crafton Water Company for the Lease Shares.
D. The Rental Amount shall be paid by Lessee to Lessor within ten (1 0) days of
the Effective Date of this Lease.
4. Assignability. Lessee shall not have the right to assign, sublet or otherwise
transfer or encumber the Leased Shares under this Lease.
5. Voting Rights. Lessor shall retain all the voting rights associated with ownership
of the Leased Shares.
6. Hold Harmless. Lessee shall hold Lessor harmless from and against any loss,
costs, expenses, damages, penalties or claims related to or arising directly or indirectly out of any
environmental or hazardous substance contamination of any water attendant to the Leased
Shares, from whatever cause. Lessee acknowledges that Lessor assumes no responsibility and
makes no representation as to the quality or purity of any water attendant to the Leased Shares.
7. Entire Agreement. This Lease constitutes the entire agreement between Lessor
and Lessee regarding the leasing of the Leased Shares to Lessee. Any prior written or oral
agreements or representations respecting the leasing of the Leased Shares not expressly set forth
herein are null and void.
8. Attorneys' Fees. In the event any action is commenced to enforce or interpret the
terms or conditions of this Lease the prevailing Party shall, in addition to any costs and other
relief, be entitled to the recovery of its reasonable attorneys' fees, including fees for use of in-
house counsel by a Party.
9. Waiver. The waiver by Lessor of the performance of any obligation hereunder
shall not invalidate this Lease nor shall it be considered a waiver by Lessor of any other
obligation hereunder.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of this
day of , 201 .
LESSEE LESSOR
CITY OF REDLANDS
By: By:
Mayor, City of Redlands.
Attest:
By:
City Clerk
L'eclerkResolutions\Res 7000-7999\7037 Water Lease Agreement.doc
Exhibit"B"
Shares Lease Agreement
(City as Lessee)
This Shares Lease Agreement ("Lease") is entered into this day of
201 ("Effective Date") by and between ("Lessor") and the City of
Redlands, a general law city incorporated under the laws of the State of California ("City").
Lessor and City are sometimes individually referred to herein as a "Party" and, together, as the
"Parties."
RECITALS
WHEREAS, Lessor is the owner of shares of the common stock of the Bear Valley Mutual
Water Company("Bear Valley"); and
WHEREAS, City desires to lease from Lessor shares of the common stock of
Bear Valley(the"Leased Shares")on the terms and conditions hereinafter set forth;
Now, THEREFORE, in consideration of the mutual promises contained herein, Lessor and
City agree as follows:
AGREEMENT
1. Lease. Lessor hereby agrees to lease the Leased Shares to City and City agrees to
lease the Leased Shares from Lessor for the purpose of providing water to City. Such water is
not intended, nor shall it be used for human consumption or domestic purposes until such time
that City treats such water in accordance with California Department of Health Services, Office
of Drinking Water Standards, and all other applicable state and local laws, rules or regulations.
2. Term. This Lease shall commence on the Effective Date and shall terminate on
, unless earlier terminated. City and Lessor understand and agree that neither this
Lease, nor any of the rights and obligations of the Parties to this Lease, shall extend beyond the
Lease Term.
3. Rent.
A. If Lessor has not already paid the annual assessment levied by Bear Valley for
the Leased Shares for this calendar year prior to entry into this Lease, City shall be obligated to
pay such annual assessment directly to Bear Valley. As rent for the Leased Shares, City shall
pay Lessor an amount equal to the total number of Leased Shares multiplied by One Dollar
($1.00).
B. If Lessor has paid the annual assessment levied by Bear Valley for the Leased
Shares for this calendar year, City shall pay, as rent for the Leased Shares, an amount equal to
the total number of Leased Shares multiplied by Two Dollars($2.00).
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C. The City shall also be responsible for the payment of any water delivery
charge for such Leased Shares to Bear Valley.
D. The rent shall be paid by the City within ten(10) days of the Effective Date of
this lease.
4. Assignability. City shall not have the right to assign, sublet or otherwise transfer
or encumber the Leased Shares under this Lease.
5. Voting Rights. Lessor shall retain all the voting rights associated with ownership
of the Leased Shares.
6. Hold Harmless. City shall hold Lessor harmless from and against any loss, costs,
expenses, damages, penalties or claims related to or arising directly or indirectly out of any
environmental or hazardous substance contamination of any water attendant to the Leased
Shares, from whatever cause. City acknowledges that Lessor assumes no responsibility and
makes no representation as to the quality or purity of any water attendant to the Leased Shares.
7. Entire Agreement. This Lease constitutes the entire agreement between Lessor
and City regarding the leasing of the Leased Shares to City. Any prior written or oral agreements
or representations respecting the leasing of the Leased Shares not expressly set forth herein are
null and void.
8. Attorneys' Fees. In the event any action is commenced to enforce or interpret the
terms or conditions of this Lease the prevailing Party shall, in addition to any costs and other
relief, be entitled to the recovery of its reasonable attorneys' fees, including fees for use of in-
house counsel by a Party.
9. Waiver. The waiver by Lessor of the performance of any obligation hereunder
shall not invalidate this Lease nor shall it be considered a waiver by Lessor of any other
obligation hereunder.
10. Termination. In the event Lessor defaults in any obligations under this Lease, in
addition to any other remedies City may have, City shall have the right to immediately terminate
this Lease.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of this
day of , 201_.
LESSEE LESSOR
CITY OF REDLANDS
By: By:
Mayor, City of Redlands
Name:
Its:
Attest:
By:
City Clerk
L`cclerksResolutionsaes 7000-7999\7037 Water Lease Agreement.doc